Tectonic 2021: How Israel And Ukraine Are Crafting Stronger Friendship

Updated
2021-12-30

2021 will be remembered not only as another year in a new COVID-19 driven reality but also as a year marked by several important dates shared by Israel and Ukraine that we at the Israeli-Ukrainian Alliance have no right to ignore.


Economic Relations


Business relations between the two countries are ahead of diplomatic and characterized by more cooperation efforts.


2021 was the beginning of new economic history as the Free Trade Agreement between Ukraine and the State of Israel had finally entered into force in January. Globally, such agreements have always been an extraordinary incentive to deeper cooperation. Therefore, our belief in Ukrainian exports (innovation, high-tech, engineering, and investment cooperation) is now stronger than ever.


According to Foreign Minister Dmytro Kuleba, the Agreement had already brought about some measurable, i.e., a 10% increase in bilateral trade in the 9 months of 2021.


And this is just the beginning: we will soon be able to see a manyfold increase in those numbers as the Agreement is now expanding to include exports of services. But this does not mean that the exports of finished products from Ukraine will stop. On the contrary, the scope of cooperation will grow even more. According to the Joint Ukrainian-Israeli Commission on Trade and Economic Cooperation, exports of Ukrainian goods to Israel grew 7%, while Israeli imports increased 13% in the last three quarters of 2021. At the same time, 44% of the goods in the bilateral trade are agricultural products.


There’s also information saying that Israeli investors invested up to $100 million in Ukraine. What attracted them in Ukraine? That we’ll learn this January. I hope they haven’t been limited by IT, but the trends say this might have been the case.


Israel’s All About Tech and Startups


According to IVC Research Center and law firm Meitar, Israeli companies and startups raised $11.9 billion in the first half of 2021 (compared to $ 10.3 billion the previous year). In total, there were 230 deals with 38 of them exceeding $100 million.


Also, the first half of 2021 has seen some 79 investment agreements worth $50 million.


The lion's share of capital came from companies in the fintech and cybersecurity sectors (with some hefty contributions from Enterprise IT & Data Infrastructure industries as well). Overall, there were 57 transactions in fintech worth about $3 billion (compared to only 26 deals in the same period the previous year), while cybersecurity companies received about $2.9 in investment money.


Investments in food technology startups and companies have also grown to exceed $300 million and 27 deals. The IoT raised more than $1 billion in the first and second quarters of 2021.


Most investments were supported by venture companies, a record $10.69 billion, which exceeds the annual figure for 2020, with leading investors including Insight Partners (49 rounds), Bessemer Venture Partners (23), and Tiger Global Partners (16). Startup scene has also been a source of surprise adding astounding 33 companies to the pool of Israeli unicorns (currently sitting at 53). What else is Israel looking at?


Israel has taken full advantage of the development impetus provided by COVID-19. Companies in the fields of retail, digital health (including fitness and beauty), cloud efficiency tools, etc. are rapidly developing. Gaming, Biotech & Life Science, Artificial Intelligence (AI), Agritech are other very active industries to watch.


Diplomatic and Cultural Relations


While 2020 gave us a new Ambassador of Ukraine to Israel (Yevhen Korniychuk), 2021 made adjustments to the Israeli diplomatic team: we now have a new Ambassador Extraordinary and Plenipotentiary of Israel to Ukraine Mykhailo Brodsky replacing Joel Lyon who held the office since 2018.


In addition, it was in 2021 that Ukraine and Israel celebrated their 30th anniversary of the establishment of diplomatic relations.


Based on this date, the Embassy of Israel in Ukraine conducted a sociological survey (omnibus) on the attitude of Ukrainian citizens to Israel, cooperation in medicine, security, and tourism. More than half (55%) of respondents considered Israel a friendly country, 88.2% supported cooperation with Israel in medicine, and 68.1% supported cooperation in security. Also, 66% of Ukrainians were interested in visiting Israel as tourists. I had no doubt the survey would have this kind of a positive outcome.


It is worth mentioning that the celebration of the 30th anniversary of diplomatic relations was marked by Yitzhak Herzog’s visit to Ukraine (which, by the way, was his first state visit as the head of Israel). In a joint statement with the President of Ukraine, he identified the most attractive areas for cooperation: new tech, innovation, cybersecurity, healthcare, pharmaceuticals, space programs, banking, finance, construction, and agriculture.


In 2021, both nations commemorated the sad 80th anniversary of the Babyn Yar tragedy and other mass executions of Jews in Ukraine. The date brought together the leaders of Ukraine and Israel to honor the memory of tens of thousands of victims. In our country, preventing and counteracting anti-Semitism is no longer just in words, but in law.


Thanks to the hard work of the diplomatic missions of both countries over the past 30 years, relations between the countries have noticeably strengthened. Popularization of cultures takes place in many areas.


The year 2021 had become a platform for testing Israeli-Ukrainian relations for strength and potential. In our opinion, both countries passed this exam with honors. The 30-year-old relationship in the economic, cultural, and diplomatic spheres had taken on new forms and had already yielded practical results. Although we all have something new to learn from each other, we can confidently do it together, as all the “grown-up” countries do.


Authors: Anna Zharova, CEO of the Israeli-Ukrainian Alliance (IUA), and Olha Stoliarchuk, CEO of the IUA Kyiv Office

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Michael Furaev

Strategic partner

Head of Quattrgroup

Visionary leader and designer of synergistic teams

Anna Zharova

CEO of IUA

Entrepreneur and International Consultant, specializes in developing, managing and launching impact projects in commercial and social spheres

Co-founder of nonprofit organization "Israeli Friends of Ukraine"

Board Member in “Pnima” - Israeli organization, uniting public and government leaders

Eddy Dave

Chairman of IUA

15 years of experience in capital markets, investments, business development

Owner of Israeli-Ukrainian outsourcing company: 400 employees, 5 years of operations, offices in Kharkov and Kiev

Managing Partner of Camalia Capital Markets, which was successfully sold to Meitav Dash 5 years ago. Meitav Dash is the second biggest investment house in Israel with more than 50b$ at the disposal

Olha Stoliarchuk

Director of IUA

LL.M., Consultant, Project Manager, Attorney-at-Law

10 years of expertise in International and Ukrainian business and corporate law, energy law and antitrust law

Member of the GS Kyiv Hub community, WEF initiative

Co-founder of investment video blogs - VC ChatrOOm

https://www.linkedin.com/in/olha-stoliarchuk/

Daniil Tsiporukha

Co-founder of IUA

Social Media, Digital Marketing and Paid Ad Expert, Entrepreneur

Skilled in PPC, Analytics, Product Marketing, Start-ups, and Product Development

BA degree in Communications and New Media Studies IDC Herzliya, MA in Law ISU Kyiv

Co-Founder at Draw Days Tel-Aviv, IUA and Echo

Eugene Proskulikov

Communication expert

Design of social, corporate, and business relations by developing and implementing long-term communication strategies and ad hoc campaigns, based on data-driven analyst, creative approach, and coherent content policy

17 years of practice in communications as a strategist, analyst, copywriter, and marketing expert. Provided services for about 200 international and Ukrainian brands in various industries

Mykyta Khodakivskyi

Co-founder of IUA

An independent international expert that has been in software development, in particular, in cross-application development projects in global e-payments, eCommerce and FINTECH for nearly 15 years

Founder of Paris-based DevteamRadar.com, he runs consultancy and software development projects to assure successful launches for new startups and SaaS businesses

Buyers Tour:Furniture and Interior Design Industries in Ukraine

Date:

05.02 - 08.02.2019

About

As for the Export Strategy of Ukraine 2017 - 2021, presented by the Ministry of Economy and Trade of Ukraine, the IT and creative industries (services) are one of the seven key directions. Moreover, the Ukrainian Furniture market is a fast-growing segment of the economy which augments 14% annually. That is why Architects & Designers Buyers Tour was a well-time event in terms of Ukrainian Export Strategy implementation and further policy adoption.

Partners

Purpose

  • Deep dive into Ukrainian Furniture Industry and Interior Design Ecosystem.
  • Present Ukraine`s export capabilities in the sector of architecture and design
  • Lay the groundwork for long-term business relations between Israeli and Ukrainian enterprises in the sphere
  • Demonstrate the feasibility of the Ukrainian market niche.

Results/goals reached:

  • 10 - 15 participants, architects, developers and design businesses from Israel;
  • 20 - 40 B2B meetings in Kyiv and its region;
  • 60% of participants report increased business linkages with businesses in Ukraine;
  • 40 new business contacts established during the trade mission;
  • 5000 of target audience reached by the media campaign in Israel;
  • 8 B2B itineraries company-specific developed.
Study tour“Exploring Israeli FoodTech Industry”

Date:

29.10. - 02.11.2019

About

With expertise in biotech, food e-commerce and ingredient innovations, Israel holds its position as one of the biggest food tech communities globally. At the same time, Kormotech is the leading pet food producer in Ukraine. Therefore, we have found an opportunity for promising cooperation through sharing experiences with high-tech and family companies, innovation, and R&D сenters.

Purpose

  • Deeper insight into the Israeli market niche.
  • Discover the hottest technologies, get to know innovative approaches in production, business development and sales strategies on an international scale.
  • Expand and strengthen the network.
  • Sharing experience and learning from real successful cases.

Results/goals reached:

  • 7 B2B meetings with key industry companies in Israel;
  • Bringing to negotiations with 3 Israeli companies.