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Twenty years ago, a peace agreement between Israel and Jordan was signed, which settled the relationship, boundaries and division of resources between Israel and Jordan. Following the peace agreement, the borders between the countries were opened, and factories under Israeli ownership were transferred to Jordan, where labor is cheaper.
In 1997, the QIZ Agreement was signed by Israel, Jordan and the US, in order to encourage business collaborations and thus promote the peace process. The agreement contributed to strengthening the political relationship and the trade relations between Israel and Jordan such that in 1998, Israeli exports to Jordan amounted to about USD 25 million, compared to USD 133 million in 2004, an aggregate increase exceeding 400%.


In 2005, free trade agreements were signed between Jordan and the United States. The Jordanian exporters moved from the QIZ framework to the framework of this agreement, while the Israeli exporters were required to face the Jordanian market with equal terms with local and foreign suppliers, without the advantage of the QIZ Agreement. As a result, exports from Israel to Jordan decreased by about 13% from USD 133 million in 2004 to about USD 116 million in 2005.


Based on the data of the Export Institute, the scope of trade (import and export) of Israel with Jordan in 2013 amounted to about USD 366 million, an increase of about 2% compared to the same period the previous year. That year, Jordan was ranked as Israel's 39th trade partner.


The export of goods from Israel to Jordan amounted in 2013 to about USD 99 million, a decrease of about 36% compared to the same period the previous year. The main decrease occurred in jewelry industry exports. In the first half of 2014, there was an increase of about 16% in the scope of exports, amounting to about USD 56 million. In 2013, Jordan was ranked as the 51st destination for the export of Israeli goods.


Changes in the export in prominent industries during the first half of 2014:
In the vehicle industry, aircraft and boating vessels experienced an increase of about 29%, and amounts to about USD 15 million, constituting about 27% of the export.
In the agricultural industry, a decrease of about 53% to about USD 6.5 million, constituting about 12% of the export.
In the machines and equipment industry, a decrease of about 4% to about USD 4.5 million, constituting about 8% of the export;
In the chemicals and refined petroleum industry, an increase of about 13% to about USD 4 million, constituting about 7% of the export.

 

Main Export Industries of Israel – Jordan ($M)

Description of Industry ($M)
H1/2013
H1/2014
Change rate 14/13
Weight in export 14

Transport tools
11.6
15.0
29%
27%
Agricultural export
13.9
6.5
-53%
12%
Machines and equipment
4.7
4.5
-4%
8%
Chemicals and refined petroleum
3.5
3.9
13%
7%
Non-imbedded source industry
0.6
3.7
526%
6%
Food, drink and tobacco products
1.9
3.3
76%
6%
Basic metal and metal products
2.4
3.0
25%
5%
Source: Export Institute

 

The import of goods from Israel to Jordan increased in 2013 by about 30% and amounted to about USD 267 million. Jordan constitutes the 30th overall source for the import of goods of Israel. In the first half of the year, the import amounted to about USD 200.3 million, an increase of about 53%.

 

Changes in the import in prominent industries during the first half of 2014:
In the plastic and rubber industry, an increase of about 243% to about USD 77 million and constituting about 38% of the import.
In the machines and mechanical devices industry, an increase of about 46% to about USD 47.5 million and constituting about 24% of the import.
In the animal and animal products industry, an increase of 430% to about USD 47 million and constituting about 24% of the import;

Main Import Industries of Israel – Jordan ($M)

Description of Industry ($M)
H1/2013
H1/2014
Change rate 14/13
Weight in import 14

Plastic and rubber
22.5
77.1
243%
38%
Machines and mechanical devices
32.5
47.5
46%
24%
Animal products
8.9
47.2
430%
24%
Chemical products
4.3
7.3
70%
4%
Textile products
2.5
4.4
77%
2%
Herbal products
0.4
3.2
782%
2%
Paper products
2.5
2.8
13%
1%
Source: Export Institute

 

Export from Israel to Jordan in 1988 – 2013, in USD millions