Although there may be some short-term disruption in trade with Israel due to Great Britain’s decision to leave the EU, and the Jewish state will lose an important ally within the European Union, James Sorene believes there may also be long-term benefits:
The UK is Israel’s second-largest trading partner; bilateral trade is worth £5 billion a year and has doubled in the last decade. . . . Britain will need to negotiate a separate trade agreement with Israel as Israel’s association agreement with the EU will no longer apply. If the UK falls into recession, bilateral trade could decrease in value as UK consumers spend less money. But there could be enhanced terms for some Israeli exports, especially agricultural produce, to the UK market once it leaves the EU.
The impact of Brexit on the EU’s policy toward Israel is debatable. In the past, the UK has [sometimes] been an important moderating voice, but often falls in line with common EU positions. The UK will no longer be present for these debates, so Israel will look to other allies in the EU such as Germany. While the UK was a very significant player in EU foreign policy, Israel has been building up relations with several countries in Eastern Europe and most recently became significantly closer to Greece and Cyprus.
In the longer term, the UK’s foreign policy could rebalance away from Europe and gravitate more to U.S. positions. Britain may feel the need to rebut any suggestion of diminished influence by taking more of a lead on the global stage. The UK has a very large foreign-aid budget and the best armed forces in Europe. It has committed significant resources to the fight against Islamic State and shares common strategic interests with Israel. None of this work is connected to EU membership, but is a function of the UK’s military and intelligence capability and its existing alliances in the Middle East.