Israel will supply 10.5% of the materials used, down from the 11.7% previously stipulated in the so-called Qualified Industrial Zones agreement
Israel's ambassador to Egypt said last week that Israel and the United States had accepted Egypt's request to reduce the minimum Israeli input required for goods Egypt can export to the United States on preferential terms.
According to the new agreement Egypt will be able to use fewer Israeli materials to make textiles sold under a trade agreement with the United States. Israel will supply 10.5% of the materials used, down from the 11.7% previously stipulated in the so-called Qualified Industrial Zones agreement, which allows Egypt to export textiles to the U.S. without paying trade tariffs.
Israeli Trade and Industry Minister Eli Yishai visited Egypt on Tuesday to sign the new percentage agreement with Egyptian Trade and Industry Minister Rachid Mohamed Rachid.
The U.S. set up the trade accord in February, 2005, as part of an effort to aid peace in the Middle East by boosting co-operation between Egypt and Israel.
The agreement applies only to factories in the specified industrial zones but the list of areas eligible has expanded over the years.
Egypt's textile and clothing exports to the United States have risen sharply since the deal.About 230 Egyptian factories' products are exempt from the import duty.