MINISTRY OF ECONOMY SIGNS AGREEMENT FOR COOPERATION WITH LATIN AMERICA'S
INTER-AMERICAN DEVELOPMENT BANK

-Chief Scientist at the Israeli Ministry of Economy, Avi Hasson, signed an
agreement for cooperation with the Inter-American Development Bank (IDB) -
the largest investment authority in Latin America and the Caribbean Islands
* The bank funds projects in Latin American and Caribbean countries at an
annual rate of $12 billion * The agreement will open new business
opportunities for Israeli companies in Latin America

-Israeli Minister of Economy Aryeh Deri: "Diversifying destination markets
is a national endeavor for the State of Israel. In the world of new
developing markets it is crucial for Israel to succeed. The agreement is an
important step for promoting economic relations, for opening new business
opportunities and for increasing Israeli exports. The State of Israel must
diversify its export destinations and economic activity all around the
world."

-Avi Hasson, Chief Scientist at the Israeli Ministry of Economy: "The Chief
Scientist's activity in the area focuses on creating opportunities to
effectively commercialize innovative solutions adapted to Latin American
markets. Implementing the agreement will give Israeli companies access to
partners in R&D and trade in the region."

JERUSALEM – 29th June 2015. Chief Scientist at the Israeli Ministry of
Economy Avi Hasson signed an agreement for cooperation with the
Inter-American Development Bank (IDB) recently. The agreement will open new
business opportunities for Israeli companies in Latin America.

The Inter-American Development Bank is the largest investment authority in
Latin America and the Caribbean Islands. There are 48 member states in the
bank, including Israel. The bank funds projects in Latin America and the
Caribbean Islands to the tune of $12 billion annually.

The agreement was signed in line with the government's policy to strengthen
trade relations with Latin American countries. The government authorized the
Chief Scientist to sign the agreement with IDB, realizing that this
institution will open opportunities for Israeli companies on the continent.

Several weeks ago the Office of the Chief Scientist at the Israeli Ministry
of Economy, MATIMOP (the international branch of the Office of the Chief
Scientist on R&D) and the Foreign Trade Administration hosted a delegation
of senior officials from the bank, who made a first visit to Israel to
discuss with the chief scientist opportunities for involving Israeli
companies in projects funded by the bank.

Among the concepts discussed: Establishing a joint $5 million fund for
subsidizing innovative projects involving Israeli companies in Latin
America, assistance from the bank in making Israeli technologies accessible
to organizations in Latin American countries, helping Israeli companies get
involved in development programs that are funded by the bank and funding
industrial R&D cooperation with a joint budget from the bank and the Latin
American countries with which the Chief Scientist has signed bilateral
agreements.

The new agreement constitutes a significant step toward upgrading the Chief
Scientist at MATIMOP's activity in the Americas, a process which started two
years ago. Cooperation programs with the Americas are run with the
assistance and coordination of the Foreign Trade Administration at the
Israeli Ministry of Economy, the trade attachés in Latin American countries,
the Foreign Ministry and embassies, and of course, local partners in the
various countries in which activities take place.

The Chief Scientist at the Israeli Ministry of Economy has recently
announced that a program for subsidizing the adaptation of products to all
Latin American countries will be expanded; the program gives Israeli
companies the possibility to receive grants from the Chief Scientist for the
purpose of adapting existing products to the demands of the Latin American
market (including establishing pilot programs, adaptation to local
regulations, reducing manufacturing costs etc.)

Israeli Ministry of Economy data shows that Israeli exports to Latin America
in 2014 stood at $2.53 billion (excluding diamonds). The field of machines
and mechanical devices was leading the export branch with 39.7% of all
exports, followed by chemicals (20.1%), then plastics and rubber (6.3%).
Brazil is Israel's main export destination in Latin America: In 2014 exports
reached $915 million, totaling 36.1% of all Israeli exports to this region.
Mexico, Costa Rica, Colombia and Chile are the next most significant export
destinations after Brazil.

Israel's network of trade agreements with Latin America

Mercosur

Israel's trade agreement with countries which are members of the South
American joint market (Mercosur) went into effect on June 1 2010 (Brazil,
Uruguay, Paraguay), and on September 9 2011 with Argentina. Israel is the
only country outside Latin America that enjoys a free trade agreement with
Mercosur states. Since the agreement became effective, two conferences took
place where senior officials from both sides participated and discussed
increasing trade. Another conference is expected this year.

Mexico

On July 1 2000 a free trade agreement between Israel and Mexico entered into
effect. The agreement promises fair competition for Israeli exporters,
mainly against competing exporters from the US, who enjoy free access to the
Mexican market due to the NAFTA (North American Free Trade Agreement,
involving the US, Canada and Mexico).

Inter alia, the agreement between Israel and Mexico regulates competition
and the rules for resolving disputes. A joint commission was established to
oversee the implementation and promotion of the agreement and joint
committees of experts were established on source regulations, customs
procedures and other issues pertaining to bilateral trade. A joint
conference is expected to take place this year.

Colombia

Negotiations between Israel and Colombia on free bilateral trade were
concluded in September 2013 and confirmed shortly thereafter by the Israeli
government. An agreement is now pending approval by the Colombian government
and will then enter into effect.

Panama

A negotiation on free trade between the two countries is currently underway.
In July, the third round of talks is expected to take place in Israel.
Another fourth round will take place before the agreement is finalized.