The Council of Ministers of the EU sanctioned the extension of cumulation rules to Mediterranean basin countries.Israeli membership in European – Mediterranean cumulation will allow its exporters to surpass one of the primary conditions of the Israel-EU trade agreement, which requires exporters to be eligible for quota benefits only by transporting goods directly to the Europe.Agreement also allows Israeli exporters to deliver cargo to the EU through third parties. Thus, Israeli factories in Eastern Europe or Jordan can now export duty-free goods to third countries within the EU.Earlier, only direct exports from Israel to the EU were exempted from custom duties so far. Now, Israeli producers in Jordan had the benefit of duty-free and quota-free exports to the US on jointly produced goods, but this facility will now include the EU also.It was not permissible to do part production in Israel and the rest in other countries (Romania, Turkey, or Jordan) and be eligible for cumulation for production rights for duty-free export to EU so far.Joining European-Mediterranean cumulation of origin zone would generate textile jobs in Israel, and would not cause shifting of production, as it would be possible to divide production phases and retain high-value production in Israel, opined Ronit Kan, deputy director Ministry of Industry, Trade and Labour foreign trade administration.
Date:10/30/2005
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