Turkey's decision to suspend all bilateral trade with Israel, valued at $7 billion annually, has significantly impacted both importers and exporters, compelling them to seek alternative routes and sources amidst the ongoing disruption of maritime trade in the Red Sea. This disruption has diminished the appeal of shipping goods from the Far East. Israeli importers are exploring indirect pathways for shipping goods through third countries, such as Slovenia, despite these routes being longer and more expensive. Moreover, some may have to switch from Turkish suppliers to more costly alternatives in Europe and the US.
The trade halt was announced by Turkey as a response until a permanent ceasefire and the provision of humanitarian aid in Gaza are assured, following the conflict with Hamas that began on October 7. Previously, in April, Turkey had already imposed restrictions on 54 products exported to Israel. Elad Barshan, co-founder and CEO of SlickChain, highlighted the abrupt nature of Turkey's action and its immediate impact, stressing the challenge it poses to importers who depended on the cost-effectiveness and quick transit times offered by Turkish imports. The cessation of trade with Turkey, Israel's fifth-largest source of imported goods, poses significant challenges, especially as Israeli businesses had been looking to increase imports from Turkey in response to rising shipping costs and disruptions caused by attacks on maritime trade.
Last year, exports to Israel from Turkey were valued at $5.4 billion, constituting 6% of Israel's total imports, a decrease from $7.03 billion in 2022. Conversely, imports to Turkey from Israel stood at $1.6 billion in 2023.
Source: timesofisrael.com
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