In recent years, Israel has expanded its economic and diplomatic ties with various countries in Asia, Africa, and Latin America—links that could conceivably offset potential damage from an increasingly hostile Europe and a less-than-wholly-supportive U.S. Has Jerusalem, then, deliberately shaped business ties in support of its diplomatic initiatives? Yitzhak Klein and Elisheva Berenbaum argue that in fact the distribution of Israel’s foreign trade has remained relatively static:
That Israel is making efforts to create closer economic relations with new partners is indisputable. But creating such opportunities is not the same thing as manipulating trade relations to reduce exposure to potentially problematic trading partners while increasing trade with diplomatically more congenial ones. . . .
Israel’s economic performance over the past decade and a half has been a solid if not a stellar success, better than most developed economies’ records. This success is one of Israel’s most important diplomatic assets: Israel’s economy is stable, growing, and features brilliant technical achievements based on its comparative advantage—a highly educated and innovative workforce. Israel is a major beneficiary of the open global economy, and its trade is determined by domestic demand and production, not by the government picking winners, whether for economic or diplomatic purposes.
The actions of other governments may, of course, force Israel to change this pattern. So far, however, the lack of Israeli diplomacy’s influence on its trade has made a quieter, more consistent, and more substantial contribution to the country’s success than any diplomatic photo opportunity.
Read more on American Interest: http://www.the-american-interest.com/2016/09/22/does-israels-trade-follow-its-foreign-relations/