Economic relations between Italy and Israel have developed significantly over the years, driven by a consistent commitment on the part of both countries to promote trade relations and bilateral investments. On the one hand, Israel looks to Italy for its established manufacturing tradition and as a gateway to the broader European market. On the other hand, Italy stands to gain from Israel’s cutting-edge technologies and its strong inclination towards technological innovation.
Despite having a relatively small domestic market, Israel presents a clear propensity to buy products and services labelled “Made in Italy”. The full potential of this aspect, which has not been fully capitalized on yet, provides significant opportunities across Italy’s key export sectors: mechanics and electronics; agri-food and beverages; furnishings (furniture, textiles, bathroom decor, appliances, kitchens and accessories, flooring, tiling, decorative items, etc.); the fashion industry (clothing, footwear, leather goods, jewelry, cosmetics, accessories).
On the Israeli side, collaboration with the Italian industry is increasingly sought after, especially by companies in the hi-tech sector and the thriving startup ecosystem in Israel. This collaboration aligns naturally with Italy’s manufacturing tradition, which is increasingly attuned to opportunities for collaboration.
Against this background, economic relations between Italy and Israel have grown consistently over the past few decades. In addition to the dynamic trend in trade, which has reached $5 billion USD, major Italian companies have a stable presence in Israel, focusing on research and development activities. Furthermore, entrepreneurial missions aimed at understanding the market and establishing connections with innovative Israeli companies have increased.
The bilateral cooperation between academic and scientific communities has played a crucial role in this process of growing relationships. This development is actively promoted and supported by the two Governments through specific programs and initiatives, as outlined in the” Agreement on industrial, scientific and technological cooperation between Italy and Israel”, which took effect in 2002.
The leading sectors of collaboration are numerous, ranging from traditional areas like chemistry, machinery, vehicles, infrastructure, energy, and agri-food, to those more closely linked to information and communication technologies, such as biomedicine, robotics, medical devices, agribusiness, intelligent systems, cybersecurity, space, and renewable energies.
Finally, there is a positive upward trend in tourism flows to and from Italy, further enhancing not only economic relations but also a cultural rapprochement between the two countries.