VIFTA Expands Opportunities for Vietnamese Goods in the Israeli Market

VIFTA Boosts Bilateral Trade Momentum

Nearly two years since VIFTA took effect, trade relations between Vietnam and Israel show strong, positive momentum. Beyond tariff reductions, the agreement strengthens business connections and investment cooperation, establishing Israel as a key emerging market for Vietnamese goods in the Middle East.

According to Le Thai Hoa, Vietnam’s Commercial Counselor in Israel, VIFTA provides a powerful catalyst for bilateral cooperation. “An increasing number of Israeli businesspeople and investors are interested in the Vietnamese market,” Mr. Hoa noted. “They actively visit Vietnam to survey the market, attend trade promotion events, and connect with local suppliers.”

This growing engagement allows domestic enterprises to leverage VIFTA commitments more effectively. It also diversifies export markets, reduces reliance on traditional trade hubs, and enhances resilience against global economic shifts.

Vietnamese seafood currently accounts for about 11% to 13% of Israel’s total seafood imports, leaving significant potential to expand market share.

Initial results reflect the agreement’s early success. In the first half of 2026, bilateral trade reached approximately $1.93 billion, marking a 5.5% year-on-year increase. Vietnamese exports surged by 35.7% to reach about $555 million. If current growth holds, bilateral trade could approach $4 billion by the end of 2026, with Vietnam’s exports to Israel exceeding $1 billion for the first time.

Investment ties are expanding alongside merchandise trade. Israel currently maintains 46 active investment projects in Vietnam totaling around $156 million in high-tech agriculture, energy, and processing industries. Meanwhile, Vietnamese companies have invested approximately $78.25 million in Israel, including ventures in high-tech battery technology.

High Complementarity and Strong Demand

The Vietnamese and Israeli economies complement each other well. Many products where Vietnam holds a competitive edge are goods that Israel must import to meet domestic consumer and production needs.

While Israel is a moderately sized market, it features rapid consumption cycles, strong financial solvency, and a highly professional business culture. “Israeli importers are serious, highly solvent, and prefer buying directly from manufacturers rather than through brokers,” Mr. Hoa observed. “They prioritize processed, value-added products with complete packaging ready for distribution.”

This aligns with Vietnam’s strategy to increase the value of its exports. Rather than shipping raw materials, many local companies now invest in deep processing, improved packaging, and brand building.

In the first half of 2026, several sectors recorded strong growth in Israel. Seafood remained a standout performer, generating about $40 million—a 30% increase over the previous year. Telephones, components, cashew nuts, and processed agricultural goods also maintained steady growth.

Israel is also Vietnam’s largest tuna export market in the Middle East.

Seafood remains a crown jewel in this trade relationship, with Vietnam serving as Israel’s largest tuna supplier in the Middle East. Following a dip in 2025, tuna exports rebounded sharply, reaching nearly $10 million in the first quarter of 2026 alone—a 33% year-on-year increase. Overall, Vietnamese seafood currently accounts for 11% to 13% of Israel’s total seafood import turnover, leaving substantial room for further expansion.

Proactive Strategies to Maximize VIFTA

To translate tariff preferences into concrete export contracts, businesses must proactively meet market requirements, ranging from rules of origin and technical standards to targeted customer outreach.

Mr. Hoa advises companies to stay updated on import policies, technical standards, and market demands while actively participating in trade promotion events. “Strengthening market guidance, providing timely updates on new import regulations, and organizing business delegation trips are essential,” he emphasized.

Furthermore, maintaining close, continuous relationships with key Israeli importers and major buyers remains the foundation for long-term success and deeper economic integration in the region.

Source: Cong Thuong Newspaper