The Media Line: Israel Weighs Response as US Imposes 17% Tariff 

Audio By Carbonatix

Enlarge

Israel Weighs Response as US Imposes 17% Tariff 

By The Media Line Staff 

Israeli Finance Minister Bezalel Smotrich said Thursday that he would convene officials to assess the economic impact of new US tariffs on Israeli exports and develop a strategy to protect the country’s economy. The tariffs, announced by President Donald Trump on Wednesday as part of a broader trade policy shift, impose a 17% duty on certain Israeli goods exported to the US. 

A Reuters report cited an anonymous Finance Ministry official who estimated that the economic impact could reach $3 billion, or about 0.6% of Israel’s GDP. 

Smotrich said he would consult economic leaders before working with ministry officials to analyze the risks and formulate policy responses. He emphasized the need to engage with President Trump’s team and strengthen domestic industry. 

The US is Israel’s largest trading partner, and the two countries signed a free trade agreement 40 years ago. Israeli exports to the US amounted to approximately $17 billion in 2024, contributing to an $8 billion trade surplus. Ahead of President Trump’s announcement, Israel cancelled the few remaining tariffs on US imports. 

The document published on Wednesday laying out the new policy said that Israel was imposing a 33% tariff on the US, a claim that Israeli economists have rejected. 

While the full scope of the US tariffs remains unclear, they are expected to affect Israeli sectors such as machinery, electrical and medical equipment, and diamonds. Many of Israel’s exports to the US are high-tech services, which are not expected to be affected by the tariffs.