Commission staff working document - Accompanying the Communication from the Commission to the European Parliament and the Council - Taking stock of the European Neighbourhood Policy (ENP) - Implementation of the European Neighbourhood Policy in 2009 Progress Report Israel {COM(2010) 207 final} {SEC(2010) 513 final} {SEC(2010) 514 final} {SEC(2010) 515 final} {SEC(2010) 516 final} {SEC(2010) 517 final} {SEC(2010) 518 final} {SEC(2010) 519 final} {SEC(2010) 521 final} {SEC(2010) 522 final} {SEC(2010) 523 final} {SEC(2010) 524 final} {SEC(2010) 525 final}
Date: 2010-05-04
Institutions: European Commission
Subjects: European neighbourhood policy, Israel, democracy, economic integration, energy policy, environmental protection, geographical mobility, human rights, legal system, political cooperation, report, settlement of disputes

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EUROPEAN COMMISSION  

Brussels, 12.5.2010 
SEC(2010) 520 final 

COMMISSION STAFF WORKING DOCUMENT 

Accompanying the 

COMMUNICATION FROM THE COMMISSION  
TO THE EUROPEAN PARLIAMENT AND THE COUNCIL 
Taking stock of the European Neighbourhood Policy (ENP) 

Implementation of the European Neighbourhood Policy in 2009 
Progress Report Israel 

{COM(2010) 207 final} 
{SEC(2010) 513 final} 
{SEC(2010) 514 final} 
{SEC(2010) 515 final} 
{SEC(2010) 516 final} 
{SEC(2010) 517 final} 
{SEC(2010) 518 final} 
{SEC(2010) 519 final} 
{SEC(2010) 521 final} 
{SEC(2010) 522 final} 
{SEC(2010) 523 final} 
{SEC(2010) 524 final} 
{SEC(2010) 525 final} 

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1. 

BACKGROUND AND OVERALL ASSESSMENT  

Israel and the European Community first established contractual relations in 1975 by signing 
a Cooperation Agreement. An EU-Israel Association Agreement entered into force in 2000. It 
sets out in more detail the specific areas in which the relations can be developed bilaterally. 
On  this  basis,  the  EU-Israel  ENP  Action  Plan  was  approved  in  April  2005,  initially  for  a 
period  of  three  years.  The  framework  for  regional  co-operation  is  the  Euro-Mediterranean 
Partnership, inaugurated in 1995 and reinforced in 2008 with the creation of the Union for the 
Mediterranean (UfM), which establishes a policy with ambitious and long-term objectives. 

EU–Israel  meetings  took  place  at  the  level  of  the  Association  Council,  the  Association 
Committee  and  subcommittees,  nine  of  which  are  activated.  In  addition,  a  wide  range  of 
contacts are maintained at all levels.  

This document reports on progress made on the implementation of the EU-Israel ENP Action 
Plan  between  1  January  and  31  December  2009,  although  developments  outside  this  period 
are  also  taken  into  consideration  when  deemed  relevant.  It  is  not  a  general  review  of  the 
political  and  economic  situation  in  Israel.  In  addition,  for  information  on  regional  and 
multilateral sector processes, please refer to the sectoral report. 

EU-Israel bilateral relations  remained strong in 2009. At the same time,  deterioration in the 
overall  political  context,  in  particular  as  regards  the  Gaza  conflict1  (see  section  on  the 
situation in the Middle East)  in  December 2008-January  2009 and  a lack of progress in  the 
Middle  East  Peace  Process,  negatively  affected  the  process  of  upgrading  bilateral  relations 
between the EU and Israel. In December 2009 the Council concluded that the EU remained 
committed to a decision, taken in 2008, to upgrade relations with Israel within the framework 
of  the  European  Neighbourhood  Policy.  However,  the  situation  on  the  ground  was  not 
conducive to the resumption of the upgrading process. The 2005 ENP Action Plan remains the 
reference document of EU-Israel bilateral relations. Its validity has been extended by mutual 
consent until June 2010.  

Israel remained an active partner in the framework of the ENP, as demonstrated by progress 
made in implementing a large number of priorities of the Action Plan. In November 2009 the 
EU and Israel signed an agreement on agricultural, processed agricultural and fish and fishery 
products, which entered into force in January 2010. An EU-Israel agreement on Conformity 
Assessment and Acceptance (ACAA) of Industrial Products was initialled in June 2009. More 
than  800  projects  including  at  least  one  Israeli  participant  were  selected  under  the  Seventh 
Framework  Programme.  Four  twinning  projects  are  currently  being  implemented  in  areas 
covered  by  the  Action  Plan  and  selected  by  the  Israeli  authorities.  International  democracy 
indexes rank Israel at levels comparable to EU Member States. As regards human rights and 
fundamental freedoms, more efforts are needed to address the economic and social situation 
of the Arab minority and enhance their integration in Israeli society.  

As regards the situation in the Middle East, Israel’s occupation of the West Bank and of the 
Gaza Strip has continued to affect the situation of the Palestinians. Israeli military operations 

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Over  1,400  Palestinians,  including  more  than  1,000  civilians  were  killed  and  more  than  5000  were 
wounded.  Thirteen  Israelis  were  killed,  including  three  civilians.  Controversy  exists  over  the  precise 
number of casualties as well as the number of civilians within those figures, but UN and the Amnesty 
International give credit to the figures.  

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in Gaza have tarnished Israel’s international standing, and have given rise to concerns as to 
international  humanitarian  law  violations  by  all  parties  to  the  conflict.  At  the  start  of  2009 
Israeli  peace  talks  with  the  Palestinians  and  the  Syrians  both  stalled.  In  late  2009,  Israel 
announced a 10-month moratorium on settlement construction in the West Bank, of which the 
EU took positive note as a first step in the right direction. However, the moratorium excludes 
East  Jerusalem,  where  settlement  activity,  house  demolitions  and  evictions  continued  in  the 
reporting period. Israel took steps to ease restrictions on movement in the West Bank. While 
these  made  a  contribution  to  economic  growth,  further  and  sustained  improvements  are 
required. Israel needs to comply fully with its commitments under international humanitarian 
law. 

After  the  Gaza  conflict  the  EU  continued  to  call  for  an  immediate,  sustained  and 
unconditional opening of crossings for the flow of  humanitarian aid, commercial goods and 
persons  to  and  from  Gaza.  However,  while  in  the  course  of  2009  a  slightly  wider  range  of 
materials  was  let  in  and  permits  were  issued  for  the  export  of  some  goods,  there  was  no 
significant  overall  improvement.  While  the  Military  Advocate  General’s  office  is  reviewing 
cases  that  have  been  submitted  since  the  Gaza  conflict  including  of  alleged  human  rights 
abuses, an independent investigation, as called for in the report of the UN fact finding mission 
on the Gaza conflict published in September 2009 (also referred to as the Goldstone Report), 
was not launched in 2009. The Israeli soldier abducted by Hamas, Gilad Shalit, remained in 
captivity. Rockets and mortars were also fired from Gaza into Israel since the end of military 
operations. 

2. 

POLITICAL DIALOGUE AND CO-OPERATION 

Shared values 

Democracy, human rights and fundamental freedoms 

Promotion  of  democracy,  rule  of  law  and  respect  for  human  rights  and  international 
humanitarian law were regularly raised with the Israeli authorities and thoroughly discussed 
during the meeting of the informal EU-Israel Informal Working Group on Human Rights in 
September 2009. 

As  regards  rights  of  minorities,  little  progress  was  registered  in  the  situation  of  the  Arab 
minority.  Arab  citizens  are  still  underrepresented  in  the  civil  service  and  in  government 
offices, with a participation of only 6.7%, although the Law for Fair Representation of Arabs 
and  Women  in  Governmental  Offices  sets  a  target  of  10%  by  2010.  There  were  further 
decreases  in  budget  allocations  to  the  Arab  sector.  More  sustained  efforts  are  needed  to 
further  increase  employment  of  Arab  employees  in  the  public  sector,  as  well  as  regarding 
housing  and  planning  schemes,  economic  development,  investment  in  social  infrastructure 
and justice (see also section on Employment and Social policy). With regard to the Bedouins, 
the  Goldberg  Commission,  set  up  in  2008,  recommended  that  the  recognition  of  Bedouin 
villages takes place on a broad basis and following an accelerated schedule. The Government 
appointed an implementation team for that purpose in January 2009, but this team made little 
progress in its work. Its detailed implementation plan was due in July 2009 but had not been 
finalised  by  the  end  of  2009.  99  house  demolitions  took  place  in  Bedouin  communities  in 
2009 and at least 39 houses were demolished in the Negev after the reporting period, in early 
2010. 

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In  the  area  of  freedom  of  expression  and  assembly  some  large  demonstrations  and  rallies 
were held peacefully during the Gaza conflict, but arrests of non-violent protesters, including 
minors,  did  occur,  also  in  relation  to  peace  protests  in  East  Jerusalem.  Throughout  2009  - 
especially  in  the  wake  of  the  publication  of  the  Goldstone  report  -  government,  media  and 
public condemnation of human rights organisations as actors that purportedly contribute to the 
delegitimisation  of  Israel  has  increased.  The  working  environment  for  NGOs  in  Israel  was 
overall worsening during the reporting period. 

In this context, a draft law regarding "Recipients of monetary support from a foreign political 
entity  for  the  purpose  of  funding  political  activities  in  Israel",  currently  debated  in  the 
Knesset,  defines  "political  activity"  as  any  activity  that  aims  to  influence  public  opinion  in 
Israel. It imposes very stringent transparency requirements and recalls the tax-exempt status 
these  organisations  currently  enjoy.  If  adopted  in  this  form,  the  draft  law  could  seriously 
curtail freedom of association and other fundamental rights. 

Israel  continues  to  arrest  and  hold  hundreds  of  Palestinians  in  administrative  detention 
without  formal  charges.  However,  over  the  year  the  number  of  administrative  detainees 
decreased, from 564 in January 2009 to 278 in December 2009. Some 8% have been detained 
for  two  to  five  years.  Arrests  and  administrative  detention  of  human  rights  defenders  were 
increasingly used particularly towards the end of 2009.  

Allegations  of  torture  and  ill-treatment  are  investigated  by  the  Inspector  for  Complaints 
against Internal Security Agency (ISA). However, the Inspector is itself an organ of the ISA. 
In  May  2009,  the  UN  Committee  against  Torture  recommended  Israel  to  create  a  "fully 
independent and impartial mechanism outside ISA". The Government has one year to address 
these recommendations. In the past three years, there has been an overall decreasing pattern as 
concerns the number of complaints filed with the Inspector of Complaints. 

As  regards  gender  equality,  the  participation  rate  of  women  in  the  labour  market  grew 
steadily.  However,  the  rate  of  participation  of  Jewish  women  is  55.7  %,  three  times  the 
participation rate of Arab women, which is 18.5 %. Furthermore, wage inequalities between 
women and men overall narrowed only moderately and were still relatively high in all sectors 
of the market. The average monthly gross salary for women is only 64% of what men earn. 
After  the  entry  into  force  of  the  January  2009  amendment  of  the  Statistics  Ordinance, 
accessibility to information pertaining to women had vastly improved. This law binds public 
agencies  to  refer  to  gender  when  conducting  and  publishing  statistic  operations  relating  to 
individuals.  

With  regard  to  the  situation  of  children’s  rights  in  January  2010  there  were  no  children  in 
administrative  detention.  At  the  end  of  February  2010  there  were  41  Palestinian  children 
detained under the age of 16. Also, several cases of night incursions in Palestinian homes in 
East Jerusalem have been reported during which children were arrested on minor charges and 
subsequently released. The newly-established Military Court for Juveniles has yet to prove its 
capacity for improving the treatment of minors.  

Combating anti-Semitism - Fight against racism and xenophobia, including Islamophobia 

The EU and Israel pursued their cooperation in supporting initiatives tackling anti-Semitism, 
racism  and  xenophobia,  which  included  joint  seminars  on  the  subject.  In  June  2009,  a  joint 
European-Israeli  declaration  was  signed,  committing  to  fighting  anti-Semitism,  to  promoting 
Holocaust  education  and  to  the  restoration  of  stolen  property.  A  new  European  Institute,  the 

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European Shoah Legacy  Institute, was established  in  Terezin  (Czech  Republic)  to  help  fulfil 
the goals of the declaration. The EU’s Fundamental Rights Agency published a new report on 
Anti-Semitism in the EU in April 2010. 

Regional and international issues 

Co-operation under CFSP/ESDP, crisis management 

The  Council  of  the  European  Union  extended  the  mandate  of  the  EU  Border  Assistance 
Mission  in  Rafah  (EUBAM  Rafah)  until  May  2010.  The  mission  maintains  its  operational 
capability  and  remains  prepared  to  redeploy  its  personnel  at  the  crossing-point  as  soon  as 
conditions permit.  

Situation in the Middle East 

Events in 2009 were influenced by the Gaza conflict and by the coming into power of a new 
Israeli Government and a new US administration. Peace talks stalled and little progress was 
made  towards  a  comprehensive  settlement  of  the  Israeli-Palestinian  conflict.  The  EU 
confirmed  its  position  on  a  range  of  issues  linked  to  the  situation  in  the  Middle  East,  both 
through private contacts with the parties and through public statements. The EU continued to 
work with its Quartet partners on a re-launch of peace talks aimed at a deal within an agreed 
timeframe. 

The  new  Israeli  Government  at  first  resisted  demands  from  the  international  community  to 
freeze  settlements  activity  in  line  with  Israel’s  Roadmap  obligations  and  the  commitments 
taken  by  Israel  at  the  2007  Annapolis  conference.  Subsequently,  in  November  2009,  the 
Government  approved  a  temporary  10-month  moratorium  on  settlement  construction  in  the 
West Bank. The freeze excludes East Jerusalem. The EU took positive note of the decision as a 
first  step  in  the  right  direction,  but  continued  to  express  concerns  about  the  situation  in  East 
Jerusalem. House demolitions and evictions of Palestinians from homes in East Jerusalem and 
other areas of the West Bank continued. No progress was made in curtailing settlement activity 
in  East  Jerusalem.  The  total  settler  population  is  now  approaching  500,000  of  which  around 
200,000  are  in  East  Jerusalem.  Plans  to  build  hundreds  of  housing  units  in  settlements  in 
Jerusalem neighbourhoods located beyond the 1967 Green Line were announced several times 
during the reporting period. 

During 2009, the EU  repeatedly  called on Israel to  open  the  Gaza  crossings  for  the  flow  of 
aid,  trade  and  persons  to  and  from  Gaza.  While  towards  the  end  of  2009  Israel  granted 
permission for glass and a limited range of other products to be imported into the Gaza strip 
and  a  limited  range  of  agricultural  products  to  be  exported,  including  strawberries  and  cut 
flowers,  there  was  no  significant  improvement  as  regards  access  to  Gaza.  Only  minimum 
access  was  granted  to  allow  the  delivery  of  humanitarian  assistance.  This  undermines  the 
ability  of  Palestinians  to  meet  basic  needs  such  as  protection,  shelter,  food,  water,  and 
healthcare. Restrictions on the import of construction material also have a negative impact on 
the population, 90% of whom are aid-dependent.  

The  Israeli  Security  Agency  in  several  instances  denied  authorisation,  citing  security 
concerns,  to  medical  patients  attempting  to  exit  the  Gaza  Strip  in  order  to  access  medical 
treatment. NGOs protested about human rights workers being prevented from entering Gaza. 
Co-operation  continued  with  Israel  on  securing  the  exit  from  Gaza  of  students  with  EU 
scholarships. As a result, 37 students left Gaza in 2009 through the Erez crossing. 

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Unilateral ceasefires were implemented by the de facto government in the Gaza Strip and by 
Israel. However, since the end of the Gaza conflict, rockets and mortar shells were fired from 
Gaza,  and  arms  smuggling  continued.  Palestinian  sources  reported  attacks  by  the  Israeli 
Defence  Forces  on  Gaza.  The  Israeli  soldier  abducted  by  Hamas,  Gilad  Shalit,  remained  in 
captivity. The EU called for a complete halt to violence and for the release of the soldier. 

The 2009 Report of the United Nations Fact Finding mission on the Gaza conflict was widely 
debated.  Israel’s  Ministry  of  Foreign  Affairs  rejected  the  content  and  methodology  of  the 
Report. In November 2009, the Military Advocate General’s office was reportedly reviewing 
140  different  cases  that  had  been  submitted  since  the  Gaza  conflict,  including  most  of  the 
allegations raised in the Report. 28 such cases are being investigated by the Military Police. No 
independent investigation into the alleged human rights violations was launched, though the 
Report requested both sides to the conflict to do so. 

During 2009, Israel took steps to ease restrictions on movement in the West Bank. In October 
2009,  there  were  578  obstacles  to  movement  in  the  West  Bank,  including  69  permanently 
staffed  check  points,  down  from  632  monitored  in  May  2009.  In  July  2009  the  Israeli 
authorities  decided  to  expand  the  Allenby  Border  Terminal’s  opening  hours  for  Palestinian 
goods. The Jalama crossing connecting the Gilboa region in Israel with the Palestinian city of 
Jenin was opened to vehicles in November 2009 for the first time in eight years. While these 
decisions made a contribution to economic growth and on improving the economic and social 
conditions of the Palestinian population in the West Bank, further and sustained efforts are still 
required, as the framework for such improvements remains severely constrained. 

Violence  perpetrated  by  Israeli  settlers  against  Palestinians  and  their  property  continued  in 
2009, with a monthly average of about 29 such incidents. In December 2009, a mosque in the 
West  Bank  village  of  Yasuf  was  torched,  allegedly  at  the  hand  of  settlers  angry  about  the 
settlement freeze announced by the Government. The authorities arrested suspects in January 
2010.  Several  NGOs  urged  the  Israeli  Government  to  take  measures  in  order  to  provide 
Palestinian residents of the West Bank with full protection.  

Non-proliferation  of  weapons  of  mass  destruction  and  their  means  of  delivery,  including 
ballistic missiles  

With  regards  to  the  EU-Israel  Informal  dialogue  on  non-proliferation  of  weapons  of  mass 
destruction, the EU continued its efforts to make progress in the implementation of the 1995 
NPT  Resolution  on  the  Middle  East.  In  the  reporting  period,  it  announced  the  intention  to 
organise  a  follow-up  event  to  the  seminar  “Middle  East  Security,  WMD  Non-Proliferation 
and Disarmament”, which took place in 2008. 

Combating terrorism 

The Israeli Government continued to put considerable emphasis on terrorism as a challenge to 
security and political leadership. Israel expressed interest in deepening collaboration with the 
EU in this area, in the form of specialised working groups on various anti-terrorism issues.  

International organisations  

In  line  with  the  joint  objective  to  promote  effective  multilateralism,  the  EU  and  Israel 
continued  to  develop  regular  contacts  on  a  number  of  matters  of  common  interest.  This 
included  discussions  on  UN-related  matters,  such  as  human  rights,  climate  change,  the 

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International  Criminal  Court,  UN  peacekeeping,  and  the  UN  reform  process  –  System-wide 
Coherence. Good progress was made in relation to Israel’s accession to the OECD. 

Israel  is  party  to  most  international  human  rights  instruments  but  not  to  their  optional 
protocols.  It  has  four  overdue  reports  of  UN  Treaty  Bodies  and  it  has  not  extended  an  open 
invitation  to  all  thematic  special  procedures.  During  the  reporting  period  Israel  did  not 
cooperate  with  the  Special  Rapporteur  on  the  situation  of  Human  Rights  in  the  Palestinian 
Territories  occupied  by  Israel,  accusing  the  Rapporteur  of  political  bias  in  favour  of  the 
Palestinian  side.  Israel  has  not  responded  to  requests  for  a  visit  by  five  UN  Special 
Rapporteurs. 

Regional cooperation  

Trilateral  cooperation  (involving  Israel,  the  Palestinian  Authority  and  the  European 
Commission  and  covering  trade,  transport  and  energy)  has  considerable  potential  but  has 
stalled.  

3. 

ECONOMIC AND SOCIAL COOPERATION 

Despite  its  high  integration  with  the  US  and  European  economies,  the  export-oriented 
economy  of  Israel  was  one  of  the  least  affected  by  the  global  economic  and  financial  crisis 
and among the earliest to stage a recovery. Several factors – the export and import structure, 
the absence of a housing bubble or a bank credit boom, high household savings rates and the 
specific policy responses – helped Israel to minimise the impact of the crisis, so the economy 
was technically out of the recession as from the second quarter of 2009. 

The  reduction  of  the  public  debt  and  the  structural  reforms  of  recent  years  as  well  as  the 
decisive easing of fiscal and monetary policy shielded GDP growth in 2009 which recorded 
an increase of around 0.5% compared to 4.1% in 2008.  

Fiscal policy was expansionary during 2009, in part reflecting the financial cost of the Gaza 
conflict,  the  set  up  of  an  inclusive  (0.7%  of  GDP)  economic  stimulus  plan  and  the  use  of 
automatic  stabilisers.  The  earlier  well-established  framework  of  fiscal  rules  –  comprising 
ceilings on deficits and on the growth of real spending – was set aside while the Government 
adopted  a  two-year  2010-2011  budget,  implementing  the  fiscal  stimulus.  Thus,  despite  that 
tax  revenues  were  stabilised  at  the  end  of  2009,  the  public  deficit  was  expected  to  rise  to 
around 5% of GDP in 2009 while public debt was expected to approach 79% of GDP.  

Monetary  policy  was  eased  decisively  by  the  Bank  of  Israel  which  reduced  interest  rates 
(from  2.5%  in  summer  2008  to  0.5%  in  April  2009),  resorted  to  quantitative  easing  and 
intervened  in  the  foreign  exchange  market  through  programmed  purchases  of  USD  which 
were  replaced  later  by  discretionary  purchases.  In  August  2009,  the  Central  Bank  of  Israel 
responded to higher than expected inflation (3.3%) and became the first developed-economy 
central bank to raise its interest rate (to 0.75%) since the onset of the global financial crisis. In 
December 2009 and January 2010, it continued to tighten monetary policy by raising its key 
discount rate by 25 basis points (to reach 1 %). Inflation for 2009 remained above the upper 
limit  of  the  Bank  of  Israel’s  1-3%  price  stability  range.  However,  stripping  out  seasonal 
factors and taxes and surcharges, the annual rate of inflation was 2.6%. 

Both exports and imports fell since the beginning of 2009. Export value of goods and services 
dropped by 20.1.% and 7.5% respectively compared to 2008, while import value of goods and 
services decreased by 28.1% and 12.1% with respect to the previous year. This fall was due to 

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the economic  crisis,  but came also as a result of  the  improvement  in  the  terms  of  trade  and 
real  depreciation  of  the  shekel  during  the  year.  The  decline  in  total  exports  of  goods  and 
services (16.4%) was more moderate than that in total imports of goods and services (24.3%). 
The  most  notable  fall  in  imports  was  in  investment  goods  (producer  durables)  in  the  first 
semester;  this  trend  reversed  when  the  recovery  of  the  economy  began.  Export  activity  was 
mainly  based  on  services  and  electronic  components  while  exports  of  goods  excluding 
diamonds  and  electronic  components  remained  sluggish  particularly  in  the  first  quarters  of 
2009.  As  a  result,  the  balance  of  trade  recorded  a  surplus  of  around  2.1%  of  GDP  in  2009 
while the current account surplus widened to around 3.5% of GDP in 2009.  

The  banking  sector  remained  solid  and  the  various  emergency  financial  sector  support 
initiatives  remained  in  place  at  the  end  of  2009,  even  though  their  use  by  the  banks  was 
limited.  However,  the  authorities  launched  procedures  for  taking  actions  to  strengthen  the 
content of supervision (see chapter 4, section on financial services). 

Employment and social policy 

Poverty and inequality remain widespread in Israel. Over 20% of households are below the 
poverty line compared to the OECD average of 11%. Poverty is concentrated among the 20% 
of the population belonging to the Arab minority (of which 50% are below the poverty line) 
and the estimated 8% who are ultra-orthodox Jews (of which 60% are below the poverty line). 
The Bedouin community suffers from a very high poverty rate estimated at 80% among the 
unrecognized villages. In November 2009, Israel celebrated for the first time the International 
day for the eradication of poverty. On this occasion, the Knesset reported on the inability of 
the Government to address social and education gaps.  

The unemployment rate stopped declining and was at 7.4% in November 2009. The highest 
rate  of  unemployment,  11.3%,  was  in  the  south  of  the  country  and  the  lowest  rates  were  in 
Jerusalem and Tel Aviv with some 4%. The Ministry of Industry, Trade and Labour prepared 
in  May  2009  an  Emergency  Plan  for  Unemployment  aimed  at  combating  rising 
unemployment caused by the economic crisis. Some minority groups reportedly face specific 
difficulties  in  accessing  the  labour  market.  Labour  force  data  reflect  serious  gaps  in  labour 
force participation for Arabs and Haredim, with only 23% of Arab women in the labour force 
and one in four Haredi men engaged in paid work.  

In the area of social inclusion, the Knesset approved in June 2009 regulations enabling savers 
in pension funds to manage their portfolio themselves with some limits. It also approved in 
January  2009  a  comprehensive  social  assistance  system  (a  “safety  net”)  for  people  over  57 
years old under certain conditions. The safety net will be activated in 2011. 

As regards social dialogue, the Government agreed in July 2009 to enact 15 laws that would 
secure employees’ rights in the work place. 

Israel continued to promote women's participation in social, economic and political life. For 
the  first  time,  in  2009,  a  female  Deputy  Minister  for  the  Advancement  of  Young  People, 
Students and Women was appointed. Women’s organisations hope that this constitutes a step 
towards  appointing  a  (female)  minister  charged  with  women’s  affairs.  However,  there  is 
pronounced  inequality  in  women’s  participation  in  the  political  system  in  Israel.  The 
percentage  of  women  represented  in  the  Knesset  (elected  in  2009)  is  19%.  Women  are 
continuously under-represented in the Knesset in comparison to other countries. 

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The second phase of establishing sustainable development indicators was finalised and the 
indicators  were  published  in  August  2009  by  the  Ministry  of  Environmental  Protection,  the 
Environmental  Policy  Centre  of  the  Jerusalem  Institute  for  Israel  Studies  and  the  Central 
Bureau of Statistics.  

4. 

TRADE-RELATED ISSUES, MARKET AND REGULATORY REFORM  

In  the  reporting  period,  the  EU  remained  the  first  trading  partner  for  Israel,  with  imports 
(excluding  diamonds)  representing  37%  and  exports  (excluding  diamonds)  29%.  Bilateral 
trade  was  however  reduced  by  20%  year-on-year  reflecting  the  impact  of  the  global  crisis. 
During  the  2008-2009  reporting  period,  EU  imports  from  Israel  fell  by  over  20%  and  EU 
exports contracted by 18%. Some market access problems remain, but progress was made in 
tackling trade irritants at the end of 2009 and in early 2010.  

As regards the liberalisation of trade in agricultural products, processed agricultural, fish 
and fishery products, the European Commission and Israel signed in November 2009 a new 
agreement that entered into force in January 2010.  

In 2009 the Israeli customs worked on a pilot phase of the TRACK (Trade related authorities 
and customs keystones) system, which allows operators and customs agents to lodge requests 
to  the  competent  authorities  and  to  follow  up  the  procedure  on  line.  The  system  transmits 
electronic authorisations to the customs authorities.  

On  free  movement  of  goods  and  technical  regulations,  the  European  Commission  and 
Israel  initialled  in  June  2009  a  framework  Agreement  on  Conformity  Assessment  and 
Acceptance (ACAA) of Industrial Products, which includes an annex on good manufacturing 
practices  for  pharmaceutical  products.  This  agreement  awaits  ratification.  Other  priority 
sectors include pressure vessels and medical devices. In the field of medical devises, the draft 
law passed the first reading in the Knesset already in 2008 and the preparations of second and 
third  reading  started  in  the  relevant  committees  after  the  2009  elections.  The  way  forward 
with  pressure  vessels  is  under  discussion  with  stakeholders.  Israel  is  also  considering  its 
possible interest in machinery as another potential priority sector. 

Some progress can be reported on consumer protection as the Knesset Economic Committee 
approved in November 2009 an amendment to the law which improves customers' ability to 
withdraw  from  ongoing  distance  selling  deals.  Accordingly,  the  customer  would  be  able  to 
cancel  the  ongoing  deal,  while  paying  only  for  the  time  he  actually  used  the  service.  The 
amendment has still to be approved in second and third readings. The new commissioner for 
consumer  protection  and  fair  trade  was  appointed  just  after  the  reporting  period,  in  early 
January 2010. 

Regarding  sanitary  and  phyto-sanitary  (SPS)  matters,  in  March  2009  the  new  phyto-
sanitary law for import of plants and plant products entered into force. Israel also adopted new 
sanitary rules for meat imports. In late 2009, the Food and Veterinary Office (FVO) carried 
out  several  missions  to  Israel  on  poultry,  fishery  products  and  milk  products,  respectively, 
which confirmed the high level of protection enforced by competent authorities.  

On the business climate, the Government approved in June 2009 an amendment to the trust 
funds law that would enable foreign funds to offer their products in Israel. No progress can be 
reported  as  regards  company  law.  During  the  reporting  period,  Israel  started  work  on 
amendments  to  the  regulation  requiring  companies  to  submit  documents  to  the  Companies 

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Registrar  not  only  in  Hebrew  but  also  in  English.  The  Act  on  corporate  governance  is  still 
under consideration in the Knesset. 

In  the  area  of  audit  and  accounting,  the  Ministry  of  Justice  and  the  Securities  Authority 
started  working  towards  the  establishment  of  an  independent  institution  to  supervise 
accountants in public companies. 

The  bilateral  negotiations  for  the  liberalisation  of  services  and  establishment  continued  in 
2009, focussing mainly on telecommunication and financial services.  

In  the  field  of  financial  services,  the  new  Bank  of  Israel  (BoI)  law  was  approved  by  the 
Cabinet in July 2009 and then submitted to the inter-ministerial committee. The draft law will 
increase  the  independence  of  the  central  bank,  establish  a  committee  with  power  to  set 
monetary  policies,  and  a  separate  management  committee 
the  bank’s 
administration. In June  2009, the  Government approved  an  amendment  prepared  by  Israel’s 
Securities  Authority  to  the  trust  funds  law  that  would  enable  foreign  funds  to  offer  their 
products in Israel. The amendment still needs to be submitted to the Parliament. 

to  manage 

Other key areas 

A  new  OECD-compatible  agreement  on  double  taxation  between  Israel  and  Germany  was 
initialled in June 2009. The Israeli tax authority proposed a new version of its proposal for a 
reform of the taxation of alcoholic beverages. The new tax regime would put an immediate 
end  to  the  discrimination  between  imports  of  whisky  and  of  other  alcoholic  beverages  and 
would eliminate the ad valorem uplift in price on imported spirits (TAMA) by 2014. The final 
version of the reform is subject to Knesset approval. In order to strengthen its administrative 
capacity to fight fictitious invoices which cause a considerable loss of revenue for the Israeli 
treasury, the Israeli tax authority set up a new system for the online VAT reporting of sales 
and inputs. In November 2009, the Knesset approved the 'green' car tax reform.  

With regard to competition policy, the Israeli Anti-Trust Authority (IAA) issued decisions in 
the banking and air transport sectors in 2009. No progress can be reported in the field of state 
aid.  

Significant progress was made during Israel’s accession process to the OECD in addressing 
the  EU’s  long-standing  concerns  in  the  area  of  intellectual  property  rights,  especially  for 
pharmaceuticals.  However,  the  IPR  legislation  needs  to  be  further  aligned  with  EU 
requirements to ensure full market access and fair competition on the world markets. 

Concerning public procurement, the “Blue & White” plan was launched in August 2009 to 
promote locally manufactured goods. The objective is to create awareness among government 
institutions, public bodies and final consumers to buy locally manufactured goods in order to 
boost  the  Israeli  economy,  create  new  jobs  and  save  existing  ones.  The  plan  does  not, 
however, impose any legal obligations to buy local products. A group of Members of Knesset 
submitted  in  August  2009  a  draft  law  granting  preferences  to  local  textile  companies  over 
foreign bidders in government textile procurements. The draft notes that it would be relevant 
only to cases which do not contradict Israel's international economic obligations. 

In  the  area  of  statistics,  Israel  cooperated  fully  over  the  reporting  period  in  the  regional 
working group bringing together representatives of the statistical offices of Egypt, Jordan, the 
Palestinian  Authority  and  Israel  which  aims  in  particular  at  defining  a  work  programme  to 
reduce asymmetries in the future. 

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On  enterprise  policy,  Israel  continued  to  implement  the  Euro-Mediterranean  Charter  for 
Enterprise. A Small Business Act, which would combine all mechanisms of support to Small 
and Medium Sized Enterprises (SMEs), is under preparation and is expected to be finalised by 
2011. The Ministry of Industry, Trade and Labour also plans a new model for an executive 
agency for small businesses. The Chamber of Commerce signed an agreement on the pensions 
for proprietors of small businesses and the self-employed in December 2009 and it is hoped 
that  it  will  pass  in  the  parliament  soon.  Late  payment  to  companies  was  eliminated  in 
government  ministries.  Small  Business  Development  Centres  (MATI)  continued  training, 
fund  raising  from  foundations  and  banks,  and  coaching  of  new  businesses.  There  are  25 
MATI  organisations  all  over  Israel.  The  third  annual  meeting  of  the  EU-Israel  Business 
Dialogue  took  place  in  October  2009.  This  business-led  dialogue  provides  a  platform  for 
European  and  Israeli  businesses  to  network  and  to  identify  regulatory  issues  of  common 
concern. The Israeli Industry Centre for Research and Development, a fully fledged member 
of  the  Europe  Enterprise  Network  (EEN)  since  2008,  participated  actively  in  the  EEN 
activities. In 2009, the Israel-EU Chamber of Commerce organised a seminar on the economic 
crisis and a public discussion on the environment and renewable energy in close cooperation 
with EU partners.  

5. 

COOPERATION ON JUSTICE, FREEDOM AND SECURITY  

In 2009, bilateral cooperation in the field of migration focused on exchange of best practices 
between  Israel  and  EU  Member  States,  both  being  destinations  for  immigration.  Israeli 
authorities, guided by a rising awareness that the country is increasingly becoming attractive 
for non-Jewish immigrants, invited experts from EU Member States to a seminar in December 
2009 with a view to sharing experience and policy options. In recent years Israel has become 
a destination country for African asylum-seekers, mainly from Sudan and Eritrea. 

With regard to the fight against organised crime, Israel did not proceed with the ratification 
of  the  remaining  Protocols  to  the  2003  United  Nations  Convention  on  Trans-National 
Organised  Crime  on  the  Illicit  Manufacturing  of  and  Trafficking  in  Firearms,  Their  Parts, 
Components and Ammunition. 

In  the  context  of  the  fight  against  trafficking  of  human  beings,  the  Ministry  of  Foreign 
Affairs  organised  a  workshop  on  human  trafficking  in  May  2009  in  cooperation  with  the 
IOM,  to  promote  international  cooperation  and  raise  awareness  of  sanctions,  protection  and 
prevention  measures.  Israel  also  supported  the  implementation  of  an  EU-funded  project  to 
build capacity to manage migration pressures including trafficking, in cooperation with civil 
society groups. Israeli  officials participated in a study visit to Austria  and  Belgium  in  April 
2009  on  the  identification  of  victims  of  trafficking  for  forced  labour  and  the  operation  of 
victim  support  services.  Israel  remains  a  key  destination  for  persons  trafficked  for  sexual 
exploitation.  While  law  enforcement  agencies  continue  working  against  human  trafficking, 
their  actions  fell  short  of  minimum  international  standards.  A  successful  conviction  against 
employers and recruitment agencies for labour trafficking has yet to emerge. As was the case 
in 2008, attention needs to be paid to rehabilitation of victims including housing and medical 
service  support  in  the  context  of  the  implementation  of  the  national  plan  to  combat  human 
trafficking.  

With  regard  to  the  fight  against  drugs,  legislative  measures  were  taken  to  include  new 
substances into the Dangerous Drugs Ordinance. Israel cooperated with the work of the Mini 
Dublin  Group  in  June  2009  which  noted  the  need  for  intensified  international  and  regional 

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cooperation. Recommendations included the establishment of a central anti-drug unit within 
the  Israeli  police  as  well  as  accurate  information  exchange  with  neighbouring  countries  on 
precursors.  Drug  trafficking  and  its  links  with  national  and  international  organised  crime 
networks  remains  an  issue  of  concern.  Israeli  law  enforcement  officials  participated  in  the 
EU-sponsored  regional  Lex  Pro  (Law  Enforcement  Exchange)  programme  including 
workshops  on  drug  interdiction  at  seaports  and  strengthening  border  controls  against 
smuggling,  in  March  and  April  2009  respectively.  In  addition,  Israeli  Anti-Drug  Authority 
officials participated in a regional coordination meeting hosted by UNODC in Cairo in June 
2009  alongside  representatives  from  Egypt,  Jordan,  Morocco  and  the  occupied  Palestinian 
territory.. Israel participated actively in the regional Euro-Med Police II programme on drug 
cooperation  and  the  annual  meeting  of  the  UN  Commission  on  Narcotic  Drugs  (CND-
ECOSOC)  in  March  2009  as  well  as  the  UN  meeting  of  Heads  of  National  Drug  Law 
Enforcement in June.  

With  regard  to  the  fight  against  money  laundering,  the  relevant  supervision  authorities 
continued  implementing  of  the  national  control  regime  based  upon  the  40  plus  9  Special 
Recommendations  of  the  Financial  Action  Task  Force  (FATF)  while  due  diligence,  KYC 
(‘know  your  customer’)  and  KYB  (‘know  your  business’)  practices  continued  to  be 
implemented  within  financial  institutions  and  the  financial  services  industry  in  line  with 
statutory obligations. 

In the area of police and judicial cooperation, work continued as in 2008, on the negotiation 
of operational agreements with Europol and Eurojust. It is a precondition for the conclusion of 
such  agreements  that  Israel  ensure  an  adequate  level  of  protection  of  personal  data.  In  this 
regard,  implementation  of  a  twinning  project  on  data  protection  started  in  June  2009.  The 
project aims to ensure the effective enforcement of national legislation on privacy in line with 
European standards as set out in EU Directive 95/46/EC and to raise public awareness among 
the Israeli administration, personal data controllers and the public on personal data protection. 
In  December  2009,  the  Working  Party  established  under  Article  29  of  the  latter  Directive, 
delivered a favourable opinion on the level of adequacy as regards protection of personal data. 
As  regards  civil  judicial  cooperation,  Israel  expressed  interest  in  acceding  to  the  Lugano 
Convention on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and 
Commercial matters.  

In  2009,  Israel  ratified  the  UN  Convention  against  Corruption.  In  international  surveys  on 
corruption perception Israel ranks similarly to EU Member States. Investigations were opened 
during the year against high-ranking Israeli politicians on grounds of corruption. 

6. 

TRANSPORT, ENERGY, ENVIRONMENT, THE INFORMATION SOCIETY, RESEARCH AND 
DEVELOPMENT, SCIENCE AND TECHNOLOGY  

Israel  cooperates  with  the  EU  in  order  to  promote  financially  sustainable,  integrated  multi-
modal transit networks in urban regions in Israel. The cooperation entails the establishment of 
necessary procedures, standards and requirements to manage sustainable public transport and 
extends to the creation of a core national transit authority to oversee the provision of public 
transport at national level. 

There were a number of delays in the construction of major railway and road infrastructures 
as  well  as  in  the  development  of  the  first  light  rail  lines  in  metropolitan  Tel  Aviv  and  an 
underground railway station in Jerusalem. 

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Negotiations  on  a  comprehensive  EU-Israel  Euro-Mediterranean  aviation  agreement 
continued in 2009. The agreement should provide for gradual market opening combined with 
a  high-level  of  regulatory  convergence.  As  regards  aviation  safety,  Israel  needs  to  further 
increase resources in order to ensure efficient safety oversight of air carriers. 

Cooperation continued to progress in the Global Navigation Satellite Systems (GNSS) field. 
Israeli Representatives took part in an FP7 event, called Growing Galileo, in January 2009 in 
Brussels.  The  first  interim  review  of  projects  was  carried  out  by  the  European  GNSS 
Supervisory  Authority.  Four  new  projects  were  selected  for  funding  for  a  total  of  EUR  1.9 
million. The setting up of the European Geostationary Navigation Overlay Service (EGNOS) 
ranging and integrity monitoring stations on Israeli territory is ongoing. 

As regards the maritime sector, in May 2009 the Israel Ports Company (IPC) completed the 
construction  of  the  new  Carmel  container  terminal  and  turned  it  over  to  the  Haifa  Port 
Company  for  operations.  It  is  expected  that  the  terminal's  infrastructure  will  facilitate  more 
efficient  service  for  importers  and  exporters  and  benefit  the  Israeli  economy.  The  IPC  has 
already begun design work on the next stage container terminals that will be needed during 
the coming decade. In September 2009 the ministerial committee for privatization approved 
the  sale  of  15%  of  the  government's  holdings  in  the  Haifa  and  Ashdod  port  companies  in 
2010. A Maritime Rescue and Coordination Centre (MRCC) was established as of June 2009 
by the Israeli Maritime Administration on its premises and under its direct supervision.  

Within the regional MEDAMOS I (MEDA Motorways of the Sea) programme, the axis Haifa 
/Trieste (Italy) was selected as one of the four pilot projects and received additional technical 
assistance. 

Since March 2009 a twinning project with the Ministry of transport and road safety aims to 
promote  financially  sustainable,  integrated  multimodal  public  transport  networks  in  urban 
regions, and to develop the capacity of the Ministry. 

In  the  field  of  energy,  Israel  took  steps  towards  the  private  production  of  electricity.  Israel 
continued  the  construction  of  internal  gas  pipelines  and  further  prepared  the  future 
construction of LNG facilities. With a view to future gas supplies, Israel confirmed its interest 
in importing Caspian energy resources. 

Israel  pursued  the  implementation  of  its  objectives  to  reach,  by  2020,  20 %  energy  savings 
and a 10 % share of renewable energy sources in electricity generation. In November 2009, 
the Government launched a new energy efficiency plan and media campaign. Israel adopted a 
strategy  to  advance  renewable  energies  particularly  in  the  Negev  and  the  Arava  valley, 
established  a  Clean  Energy  Forum  of  stakeholders  and  announced  a  tender  for  the 
establishment of a renewable energies centre. It also launched various projects for new wind 
farms, solar thermal and photovoltaic power plants. Israel furthermore started preparations for 
a  master  plan  for  the  development  of  renewable  energies.  These  actions  are  of  particular 
relevance in the context of the development of a Mediterranean Solar Plan.  

The trilateral energy cooperation between Israel, the Palestinian Authority and the European 
Commission, which was re-launched in 2008, stalled in the context of the Gaza conflict. The 
aim  remains  the  establishment  of  a  joint  energy  office  and  the  facilitation  of  projects  of 
common interest, such as the joint Israeli-Palestinian “Solar for Peace” initiative. In 2009, an 
EU  funded  study  to  support  the  “Solar  for  Peace”  project  was  completed.  The  European 
Commission encouraged partners to fully re-activate the trilateral cooperation. 

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In the field of climate change, work continued on greenhouse gas emission inventories and 
Israel  started  preparing  its  Second  National  Communication  to  the  UN  Framework 
Convention  on  Climate  Change.  A  Ministerial  Committee  on  Environmental  Protection  and 
Climate Change was set up. Sectoral committees started preparing a national action plan on 
mitigation  issues.  Work  teams  were  appointed  to  prepare  a  recommendation  for  a  national 
plan  relating  to  preparedness  for  and  adaptation  to  climate  change  in  the  fields  of  energy 
demand  for  heating  and  cooling,  water  resources,  agriculture,  construction,  public  health, 
coastal  infrastructure,  drainage  and  erosion,  economy  and  insurance,  geo-strategic  aspects, 
biological diversity and natural habitats and tourism. Israel took steps to prepare and approve 
further  Clean  Development  Mechanism  (CDM)  Projects.  Three  new  such  projects  were 
registered  at  UN  level,  bringing  the  overall  number  of  registered  CDM  projects  to  16. 
Israel associated itself with the Copenhagen Accord and provided information on targets and 
actions that it will implement.  

The Ministry of Environmental Protection announced its main priorities for 2010, including 
waste  management,  air  pollution,  climate  change,  environment  education,  strengthened 
enforcement  and  promoting  a  sustainable  lifestyle.  The  Government  decided  to  make 
government  ministries  more  environmentally  efficient 
through  setting  quantitative, 
measurable targets inter alia for the reduction of electricity, water and paper consumption and 
the reduction of waste. 

New  or  amended  regulations  on  freedom  of  information,  air  quality,  waste,  hazardous 
substances,  nature  protection,  protection  of  the  coastal  environment  and  non-ionizing 
radiation were adopted. Preparations continued with regard to new or amended legislation on 
asbestos, packaging waste, the marine environment, enforcement, wildlife protection and non-
ionizing  radiation  as  well  as  new  or  amended  regulations  on  air  quality,  marine  pollution, 
non-ionizing radiation, noise and the landscape protection fund.  

Israel  took  steps  to  prepare  a  packaging  and  packaging  waste  policy.  “Green  taxation”  was 
introduced  to  promote  the  purchase  of  less  polluting  private  vehicles.  A  strategy  on 
sustainable  household  consumption  and  sustainable  consumption  processes  in  industry  is 
under preparation, as well as a strategy on industry and the environment. Work continued to 
implement existing strategies and plans, where continued attention is required. 

Steps were taken to strengthen administrative capacity, inter alia the establishment of a unit 
under  the  nature  and  parks  authority  to  identify  and  accompany  enforcement  of  waste 
offences. New local environment units were set up in some municipalities. Action was taken 
towards  the  establishment  of  uniform,  shorter  and  consistent  administrative  enforcement 
procedures.  Overall,  the  administrative  structures  still  need  to  be  strengthened.  Steps  were 
taken  to  integrate  environment  considerations  in  other  policy  areas,  such  as  transport  and 
agriculture.  Some  steps  were  taken  to  promote  integrated  permitting,  notably  in  Haifa  Bay. 
Technical guidelines for the industry on integrated permitting were prepared. 

Israel  continued  to  publish  environmental  information  on  a  regular  basis,  and  carried  out 
activities to inform and involve the public. Steps were taken to prepare a set of environmental 
indicators to reflect the state of the environment in recent years. Preparatory actions continued 
on a pollutant release and transfer register, including a draft list of its scope, preparations for a 
pilot  study  and  examination  of  required  legislative,  administrative  and  organisational 
adjustments. 

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There were no significant developments in the reporting period concerning ratification of the 
remaining  Protocols  to  the  Barcelona  Convention  for  the  Protection  of  the  Marine 
Environment and the Coastal Region of the Mediterranean2. Israel continued to participate in 
the  Horizon  2020  Initiative,  in  the  preparation  of  a  strategy  for  water  in  the  Mediterranean 
(which  failed  to  get  approval  at  the  recent  ministerial  meeting  of  the  Union  for  the 
Mediterranean), in the Mediterranean Action Plan and in the EU Water Initiative. Cooperation 
and information exchange took place between the European Commission and Israel, including 
on water, pollution reduction in the Mediterranean region and environmental reporting.  

In the field of civil protection, Israel took part in the a new phase of activities of the Euro-
Mediterranean  Programme  for  the  Prevention,  Preparedness  and  Response  to  Natural  and 
Man-Made  Disasters  that  started  in  2009,  continuing  the  process  of  strengthening  civil 
protection activities in the region, enhancing capacities at regional, national and local levels, 
and  promoting  institutional  cooperation.  Hereby,  further  steps  were  taken  to  bring  Israel 
closer  to  the  European  Civil  Protection  Mechanism,  contributing  at  the  same  time  to  the 
development  in  the  region  of  a  civil  protection  culture  based  on  an  integrated  approach 
covering disaster prevention, preparedness and response. 

As regards regulatory developments in the information society sector, in 2009 the Ministry 
of Communications only partially implemented the recommendations set out in the report of 
the Committee for Promotion of Competition in the Telecommunication Industry in Israel (the 
Gronau Committee). The communications market in Israel is still not effectively liberalized. 
The  Ministry  of  Communications  launched  a  public  consultation  on  the  adjustment  of  the 
regulatory regime for cellular Internet services to the market environment, as regards cellular 
broadband service tariffs, quality, and variety. 

In October 2009, Israel’s leading electronic communications provider announced the sale of 
approximately  30%  of  the  company’s  share  capital.  The  Ministry  of  Communications  in 
charge of promoting competition in the sector, is closely examining the implications of such a 
transaction for the development of competition and for the growth of the telecom sector. The 
same  month  the  leading  provider  also  announced  the  deployment  of  the  most  advanced 
communications network in Israel, while speeds on existing networks already reach around 10 
MB.  In  addition,  they  announced  a  number  of  advanced  services  such  as  a  new  standard 
wireless  router,  a  storage  portal  on  the  network,  High  Definition  telephony,  self-service 
services for telephone line management through the internet, and internet telephony. 

The  Ministry  of  Communications  granted  a  Voice  Over  Broadband  (VOB)  licence  to  a 
company owned by the leading provider. The licence will enable the company to deliver VOB 
services to private customers and business clients.  

In December 2009, the Ministry of Education and the Ministry of Communications decided to 
carry out an extensive programme to increase Internet safety awareness among children and 
teenagers. The programme will cover unsafe usage, such as network bullying or exposure to 
violent or illegal contents. 

Exchanges  of  views  on  cultural  and  audiovisual  policy  took  place  in  various  frameworks 
such as European Film Festivals and training workshops.  

2 

Israel  has  signed  but  not  ratified  the  Barcelona  Convention’s  New  Emergency  Protocol,  nor  the 
protocols  on  Specially  Protected  Areas  and  Biodiversity  and  Integrated  Coastal  Zone  Management 
(signed in January 2008). It has not ratified the amendments to the Dumping protocol. 

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In the area of science and technology, the already extensive cooperation between the EU and 
Israel was further developed. Israel has been associated to the 7th Framework Programme for 
Research and  Development  (FP7) since its inception. By November 2009 nearly 700 Israeli 
research entities had been selected for funding, particularly in the Ideas programme and in the 
Information  and  Communication  Technologies  (ICT)  and 
themes.  The 
performance of Israeli universities and research institutes was particularly strong, with these 
organisations receiving some 63% of the overall funding of EUR 243 million in grants going 
to Israeli participants up to November 2009. 

the  Health 

In November 2009, Israel and the EU organised their fifth Joint Research Committee meeting 
at which both sides expressed satisfaction with the development of S&T cooperation. Beyond 
the Israeli participation in FP7 the parties also discussed the participation opportunities for EU 
researchers in Israeli research programmes and projects. 

The  Scientific  Council  of  the  European  Research  Council  (implementing  the  Ideas 
programme of FP7 in frontier research) met in Israel in December 2009. On that occasion, an 
information  day  on  the  Ideas  programme,  aimed  mainly  at Israel's research universities was 
held.  

Eleven  Israeli  research  organisations  are  collaborating  with  European  Commission  the  Joint 
Research  Centre  of  the  in  14  competitive  activities  (FP6  projects)  (food  safety  and  quality, 
nanotechnology, photovoltaics, health, environment, chemicals and energy). 

7. 

PEOPLE-TO-PEOPLE CONTACTS, EDUCATION AND HEALTH 

In May 2009, a first senior officials meeting on implementation of the Joint Declaration with 
the European Commission on cooperation and dialogue on education and training took place 
in Brussels with an exchange of views on approaches to lifelong learning, recognition of study 
credits  and  utilization  of  information  and  communication  technologies  in  education.  The 
Ministry of Education published plans to develop of school education in peripheral areas by 
providing financial incentives for teachers and to increase the number of high schools entitled 
to  Government  aid  by  some  100  schools.  However,  investment  in  education  per  capita 
remains far below comparable international indicators at all systemic levels including salary 
levels and pupil-teacher ratio.  

In  October  2009  the  Israeli  Council  for  Higher  Education  presented  the  Knesset  with  data 
showing that Israel has the highest rate of brain drain in the world, warning against continued 
erosion  of  higher  education  and  the  status  of  academics.  However,  inadequate  funding  of 
higher  education  continues  to  be  an  area  of  concern  alongside  academic  freedom  and 
movement of people including Palestinian students and academics. 

Israel  participated  actively  in  the  second  Call  for  Proposals  for  Tempus  IV  benefiting  from 
one project, on quality assurance at regional level for the academic year 2009-10. In addition, 
Israeli  students  and  scholars  benefited  from  Erasmus  Mundus  scholarships,  including  69 
mobility  grants.  Israeli  universities  are  encouraged  to  continue  submitting  high-level 
applications for projects under the Jean Monnet programme. 

In  the  field  of  culture,  nine  projects  were  selected  under  a  call  for  proposals  for  local  and 
regional cultural activities including Arab-Israeli intercultural cooperation. At regional level, 
Israel participated actively in the new Euro-Med Heritage IV programme.  

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As Israel is not a party to the 2005 UNESCO Convention on the Protection and Promotion of 
the  Diversity  of  Cultural  Expressions,  a  dialogue  and  exchange  of  views  on  cultural  and 
audiovisual policy did not emerge. On the same grounds, Israeli cultural organisations could 
not participate in the Call for Proposals for the 2009 ENP Special Action under the Culture 
Programme. 

Extensive  contacts  continue  between  the  EU  Delegation  and  representatives  of  Israeli  civil 
society.  A  seminar  for  European,  Israeli  and  Palestinian  NGOs  was  organised  in  Ireland  in 
February  2009  to  learn  from  peace-building  experience  before  and  during  the  Irish  Peace 
Process. A successful means of developing links between Israeli and EU civil society within 
the ENP framework remains to be formulated.  

Israel and the EU sustained health sector dialogue. Israel took measures to combat influenza 
A (H1N1) including through vaccination and an awareness campaign. In October 2009, Israel 
participated  in  the  newly  established  EU  enlarged  health  information  committee.  Israel 
pursued  participation  in  the  ‘Episouth’  network  on  communicable  diseases  for  the  EU, 
Mediterranean and Balkan countries.  

8. 

FINANCIAL COOPERATION – 2009 KEY FACTS AND FIGURES  

The  European  Neighbourhood  and  Partnership  Instrument  (ENPI)  envelope  for  Israel  under 
the  National  Indicative  Programme  2007-2010  is  EUR  8  million,  initially  divided  into  four 
yearly  EUR  2  million  tranches.  The  proposal  was  slightly  reduced  in  2009  to  EUR  1.5 
million.  

As  a  developed  country,  Israel  is  not  a  typical  beneficiary  of  ENPI  assistance.  Instead,  the 
programme is geared towards supporting the achievement of key policy objectives as outlined 
in  the  EU-Israel  ENP  Action  Plan  and  pursues  the  approximation  of  Israeli  norms  and 
standards to those of the EU. 

Currently, implementation of the measures covered by the 2007 Annual Action Programme is 
still underway with two twinning projects in the field of data protection and transport. A third 
twinning  project  will  start  in  March  2010  with  the  overall  objective  of  strengthening  the 
capacity of the Equal Employment Opportunity Commission in Israel. A call for proposals to 
select the twinning Member State counterpart is ongoing in the field of veterinary standards. 
Identification of projects from the 2009 allocation is still in progress. 

An indicative financial envelope of EUR 6 million will be available to support co-operation 
activities in Israel in period 2011-2013, based on a European Commission decision of March 
2010. 

In  addition  to  the  bilateral  allocation,  Israel  also  benefited  from  cooperation  activities 
financed  under  the  ENPI  multi-country  and  regional  programmes,  as  well  as  horizontal 
thematic  programmes,  such  as  the  "Partnership  for  Peace"  Programme  for  civil  society 
organisations, the European Instrument for Democracy and Human Rights (EIDHR) and the 
Non-State Actors and Local Authorities in Development (NSA/LA) programme.  

Israel  also  participates  in  the  Cross-Border  Cooperation  (CBC)  Mediterranean  Sea  Basin 
programme (EUR 173.6 million for the whole programme in the period 2007-13).  

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