Why Boris Johnson Is Good for the Israeli Economy, According to British-Israeli Industrialist

Terry Newman explains why Brexit will do good for Israel's trade agreements with its third-largest export market

Boris Johnson.
Alastair Grant,AP

British Prime Minister Boris Johnson, who stands for reelection on Thursday, wants stronger ties between Britain and Israel, and if he wins, Israel will benefit, because Britain’s economy is based on services, especially financial services, and is heavily invested in high tech and cyber, Terry Newman, chairman of Isramarin, an Israeli modular housing firm told TheMarker this week.

Trade between Israel and Britain stands at 8 billion pounds sterling, about 36.5 billion shekels, Newman said, speaking by phone.

Britain is Israel’s third largest export market after the United States and China, with sales of $4.3 billion in 2018. Israel’s main exports to the U.K. are medications, precious stones, plastics, mechanical equipment, electronics and fruits and vegetables.

After only two and a half years, Britain will go to the polls on Thursday in an election considered the most important since World War II. According to a survey on December 9, the Conservative Party, led by Johnson is holding to a stable lead of about 10 percent over Labour, the second largest party.

Newman, who is a former bureau chief for the late Labour member of Parliament Lord Greville Janner, if Johnson wins, he will restart the Brexit process, which will negatively impact the British economy, politics and society. But in terms of the Israeli economy, this is good news.

If Britain leaves the European Union, it will have to sign separate trade agreements with the countries it trades with as part of the EU.

“Johnson will have to prove that after Brexit, he can deliver new agreements to Britain, and Israel is one of the countries in which Britain wants to invest.” The many daily flights between Tel Aviv and London shows the magnitude of the connection, says Newman, who is a member of the World Jewish Congress Diplomatic Corps.

According to the Export Institute, Israel’s exports to the U.K. went from about $2 billion in 2010 to nearly $5 billion in 2017. The export of pharmaceuticals increased by 320 percent in that period, from to $870 million to $66.3 billion.

“One out of every seven medications used by the National Health Service is from Israel,” Newman said.

Israel also exports security systems to the U.K., which allows the British army to operate in Afghanistan and elsewhere,” Newman said.

Even if Johnson’s opponent, Labour’s Jeremy Corbyn wins “and wants to immediately stop trade with Israel, that can’t happen. The British army depends on Israel,” he added.