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| Israel to benefit from new EU rule
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Israel is to be the main beneficiary of a new trade agreement with the European Union which allows countries with special direct export status to export products from a third country to Europe under the same terms.
The present Israel-EU Trade Agreement includes a "direct shipment" rule which states that to be eligible for origin benefits, an Israeli exporter must ship goods directly from Israel to the destination in Europe.
Ambitious project
Laszlo Kovacs, European Commissioner for Customs and Taxation, said: "This new Pan-Euro-Mediterranean zone will make it easier for producers and traders within the zone to benefit from preferential customs tariffs. It is an ambitious project aimed at boosting the competitiveness in all participating countries."
According to Globes, an Israeli business site, the main beneficiaries will be Israeli textile companies. The ministry of industry, trade and labour believes that the agreement will save hundreds of jobs in the textile and related industries in which splitting manufacturing processes is important.
The Israel textile industry currently out sources much of its work to third countries such as Turkey, Romania and Jordan. Even if simple stitching was currently done in any third country, that company would have had to pay higher tariffs when exporting to Europe.
In the past these extra incurrences have made it difficult for Israeli textile companies to compete with certain textile businesses from the Far East because the human labour costs there are very low.
Concern for textile workers
There is some concern that these new rules will see people in the Israeli textile business lose their jobs as the company may be able to find their tasks cheaper to do overseas.
However, Ronit Kan from the ministry of industry predicts that joining the European-Mediterranean cumulation of origin zone will create textile jobs in Israel, and will not cause the export of production, since it will be possible to split production stages and keep high-value work in Israel.
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