(Communicated by the Foreign Minister’s Bureau)

The government today (Sunday, May 18, 2014) approved a plan to strengthen economic ties with Latin American countries and the four member state of the Pacific Alliance - Colombia, Mexico, Chile, Peru and Costa Rica.

In accordance with the government's decision, Foreign Minister Avigdor Liberman will head an inter-ministerial team led by the Director General of the Ministry of Foreign Affairs and with the participation of the Director General of the Prime Minister's Office, the Director General of the Ministry of Economy, the Director General  of the Ministry of Tourism, the Director General of the Ministry of Science, Technology and Space, the Director General of the Ministry of Agriculture and Rural Development and the Comptroller General.  The team will promote the government work plan for developing economic ties with these countries. The plan was formulated over the past few months by an inter-ministerial action team headed by Harel Locker, the Director General of the Prime Minister's Office, and the Ministries of Foreign Affairs, Economy, Tourism, Agriculture, Science and Technology and Finance.

The decision includes the opening of an embassy in Paraguay, the expansion of operations of the Israeli embassies in the Pacific Alliance countries, the bolstering of the missions in Mexico, Colombia and Costa Rica, and the fortification of MFA staff activities with these countries. This move is part of the government policy to diversify trade objectives of the Israeli economy, and follows the initiative of the Ministry of Foreign Affairs that led to Israel’s accession as an observer state in February this year. Following its accession, Israel will participate in the staff work and conferences of the Pacific Alliance, thus enabling Israel to promote cooperation with the member states.

Following the decision, FM Liberman noted that "Israel's accession this year as an observer in the Pacific Alliance was an important political move that also has important economic consequences. In addition to strengthening political ties, this will also result in a significant strengthening of the Israeli economy in markets with great potential." FM Liberman is due to visit some of these countries in the forthcoming months.

The combined Gross Domestic Product of the Pacific Alliance countries is approximately $ 3 trillion, and represents 40% of the the GDP of the entire Latin American continent. The Pacific Alliance is the sixth largest economy in the world, concentrating 50% of the continent's trade and 26% of its foreign investment (over $ 70 billion).

The program, with an investment of over NIS 50 million spread over four years (2014-2017), will lead to the opening of two new economic missions in Chile and Peru, the promotion and signing of financial protocols with Colombia, Brazil and Chile, to collaboration with the American Development Bank and more.
 
The average growth of the Pacific Alliance member countries is 5%, and the expected growth in imports is expected to reach 6% a year. There is a huge demand in Latin America, particularly in the Pacific Alliance countries, for Israeli technology and know-how in various spheres such as infrastructure, agriculture and science.

Exports of goods from Israel to the Pacific Alliance states in 2012 exceeded a billion dollars, only 2% of the total exports of the State of Israel.
 
Benefits to the Israeli economy in strengthening ties with the Latin American countries in general and the Pacific Alliance in particular are the diversification of Israeli export markets and increasing the immunity of the Israeli economy to international market volatility. Maximizing the trade potential with these countries will increase Israeli exports, which in 2013 totalled $ 66.5 billion, of which the exports to the Pacific Alliance countries amounted to only 2% of total exports.