JERUSALEM — Canada’s Finance Minister Jim Flaherty met with members of Israel’s financial community and representatives from Israel’s high-tech sector during his visit to Israel last week.

He made no secret of Canada’s desire to expand its free-trade relationship with Israel.

“I admire what has been done with the Israeli economy. We have much to learn on research and development and boosting innovation and productivity. I look forward to learning more,” Flaherty said at a Jerusalem reception marking the Israel-Canada friendship.

Israeli Finance Minister Yuval Steinitz said that the Canada-Israel Free Trade Agreement (CIFTA) has been beneficial for both countries. Now, both governments want to expand the trade agreement’s scope.

CIFTA went into effect in 1997, initially eliminating tariffs on all industrial products manufactured in Canada and Israel, as well as a limited number of agricultural and fisheries products. By 2003, additional agricultural and agri-food tariff reductions on goods previously excluded from the agreement were successfully negotiated, according to Canada’s Department of Foreign Affairs and International Trade.

“We want to expand the free-trade agreement with Canada. It’s good for us to export and import but, more importantly, an Israel-Canada relationship can build co-operation in high-tech, biotech, between universities, research and development and innovation commercialization. Relationships are already good, but there’s room for improvement,” Steinitz told The CJN.

“Canada and Israel are two of the few countries that succeeded to grow again following the economic crisis. Both governments need to enhance and promote and widen [CIFTA] to other areas, and I’m confident this can continue to our economic co-operation in the future,” Steinitz said.

Israel is Canada’s sixth-largest export market in the region. The Canadian government reports that Canada-Israel bilateral goods trade has more than doubled since the inception of CIFTA, from $507 million in 1996 to $1.4 billion in 2010.  

“Co-operation in science and technology, research and development, sophisticated agriculture, military co-operation, this co-operation is going to be enhanced,” said Minister for Strategic Affairs Moshe Ya’alon. “We share not just the same interests, but we share the same values.”

In Canada, the government’s consultations are ongoing on how best to modify CIFTA.

Flaherty conducted a conference call with Canadian media from Tel Aviv last week.

In his preamble to the gathered media on the call, Flaherty noted that while in Israel he’d met with, among others, Israeli Finance Minister Yuval Steinitz; Palestinian Monetary Authority governor Jihad Al Wazi, and Stanley Fischer, governor of the Central Bank of Israel.

“Their perspectives were helpful in understanding the economic landscape here,” Flaherty said.

He said he also visited the Weizmann Institute and the Technion Institute of Technology, calling the visits “informative.”

Asked by The CJN how he plans to increase trade and grow the Canadian economy via relations with Israel, Flaherty said he met with Israeli Chief Scientist Avi Hasson “and had a good discussion” about venture-capital initiatives, innovation and research and development programs.

Flaherty also reiterated Steinitz’s position that broadening CIFTA is a priority.

“We are advocating expansion of free trade with Israel. That would be desirable,” he said.

The biggest lesson he learned from his trip to Israel, he said, is that Israel’s focus on the research and development sector was a result of “an intentional effort to become a world leader in commercialization.

“Canada has a challenge… we’re one of the world leaders in investing in R&D, but we’re not getting the productivity results we should be seeing from that investment. So I learned a great deal about how R&D and innovation are approached here, not only by government but also by the universities, research institutes and by businesspeople who invest.”

He said Canada should consider emulating some “aspects” of the work Israelis do in these areas.

With files from Andy Levy-Ajzenkopf