Israel - China trade relations Ms. Yifat Inbar Director, China and India Affairs

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1 Israel - China trade relations Ms. Yifat Inbar Director, China and India Affairs October 2013

2 About the Foreign Trade Administration China Israel Bilateral Trade Support tools for exporters to China Our activities in the medical sector in China

3 About the Foreign Trade Administration

4 Who are we? What we do? The Foreign Trade Administration (FTA) at the Ministry of Economy manages and directs Israel's international trade policy by: 1. Initiating and overseeing trade agreements; 2. Exports promotion; 3. Overseeing the operations of 41 trade missions that act at the forefront of the Ministry s efforts to boost the Israeli industry competitiveness in foreign markets. 4. Devising specialty support tools for exporters

5 Our presence across the globe Local trade officer Mission headed by a commercial attaché

6 Bilateral trade relations

7 Export Distribution אסיה האיחוד האיוחדהאירופי ארה"ב יתר הארצות 24% 24% 21% 31% SOURCE: CBS

8 Bilateral trade data: 2012 Key exports Trade Balance Trade Value Import Export Machinery, electronic equipment, chemicals USD $-2.58 Bn USD $8.06 Bn *(-1.3%) USD $5.32 Bn *(-3.52%) USD $2.74 Bn *(+0.9%) Trends of exports (2012): v Chemicals -31% v Diamonds -28% v Metals -20% v Medical and optical equipment -9.5% v Machinery and electronic equipments + 39% Compared to 2011 *

9 Trade Trends 200% 150% Millions USD % Change Imports/exports Imports/exports סך היצוא שינוי- יבוא 100% 50% 0% %

10 CHALLENGES EXPORT CONTROL CUSTOM TARIFS AND NTBS GAP OF BUSINESS EXPECTATIONS BETWEEN ISAELI AND CHINESE SIDE BAD REPUTATION AN LACK OF RELIABLE INFORMATION CULTURAL DIFFERENCE HIGH COSTS AND LONG PROCESSES HIGH COST FOR ESTABLISHING A PRESENCE IN CHINA MANY COMPETITORS ADVANTAGE TO SIZE WHILE ISFRAELI COMPANIES ARE MOSTLY SMEs LACK OF TRANSPERANCY LACK OF EXISTING NETWORK DIFFICULTY TO FIND AN ADEQUATE LOCAL PARTNER FINANCING TECHONLOGICAL ADAPTATION SIZE AND DIVERSIFICATION SECURING INSURANCE FOR FOREIGN TRADE RISKS THE NEED TO PROOVE YOUR TECHONOLGOY ON THE LOCAL MARKET

11 Support tools for exporters to China

12 Covering the Chinese Giant 5 Commercial attachés in 4 trade offices: v Beijing: two attaché in Beijing (including regulatory affairs expert) v Guangzhou: Trade office v Shanghai: Trade office v Hong Kong: Trade office v Dalian, Shenzhen and Chengdu: Offices operated by local employees in

13 Encouraging Exports and Cooperation Two designated financial protocols: v Financial protocol for general exports v Financial protocol for water projects in agricultural applications The China India Fund : v 50% of the expenses involved in placing an employee China up to 120,000 USD v 50% of the expenses involved in hiring a local consultant in China up to 40,000 USD v Logistics costs associated with operating an office in China or India Bilateral R&D cooperation program v Program signed with the central government v Similar Programs signed with Jiangsu, Shanghai, Shenzhen, Shandong and Guangdong v Prospective program with Hong Kong

14 Encouraging Exports and Cooperation Support for clusters: v Assistance for infrastructure-oriented projects v Agricultural demo center in Fujian International Projects and Tenders Fund: providing assistance for companies wishing to conduct background survey, feasibility study and tender applications. Information! Information! Information! v Mini-portal v Guides of regulation: cosmetics, medial equipment registration v Specialized seminars

15 The Game Changer : A prospective China Israel Free Trade Agreement Preliminary discussions has been initiated towards a joint feasibility study

16 ACTIVITIES IN THE MEDICAL DEVICES SECTOR A designated commercial attaché for medical equipment regulatory affairs: - Regulatory aspects - registration, labeling, release of goods, distribution licenses - Professional aspects - finding distributors, exhibitions, establishing presence. Guide of China s regulations in the field of medical equipment National pavilion at CMEF exhibition Hosting delegations Coordinating meetings at MEDICA exhibition.

17 Thank you