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Last updated in October 2017

Political relations

Germany has a special relationship with Israel owing to its responsibility for the Shoah, the systematic genocide of some six million European Jews during the National Socialist era.

Since the establishment of diplomatic relations on 12 May 1965, German-Israeli relations have continued to grow deeper and closer in the official domain and at the level of civil society. Today, German-Israeli relations are close and friendly.

The unique relations between Germany and Israel are a cornerstone of German foreign policy. Germany is a staunch supporter of Israel’s right to exist and, as an active partner in the EU, promotes peace efforts in the Middle East. In the United Nations, it seeks to strike a fair balance in dealings with the two sides to the conflict. In the European Union, Germany supports the active integration of Israel as part of the EU’s association policy. In international bodies, Germany combats all forms of antisemitism, racism and xenophobia.

The institution of annual intergovernmental consultations between the two countries in 2008 opened up a new chapter in bilateral relations. The two countries’ Cabinets met for the sixth time in February 2016. In addition, numerous official visits in both directions testify to the intensity and diversity of relations. In 2015, Germany and Israel celebrated the 50th anniversary of the establishment of relations with a host of political and cultural events in both countries.

German-Israeli Intergovernmental Consultations: Challenges of an Open Society in the 21st Century. Joint Statement by the Chancellor of the Federal Republic of Germany and the Prime Minister of the State of Israel (Berlin, 16 February 2016) PDF / 296 KB

Economic relations

Germany remains Israel’s principal trading partner in the European Union, with bilateral trade worth 6.59 billion US dollars in 2016. Globally, Germany is Israel’s fourth most important partner, after China, the United States and Switzerland. Israel’s main imports from Germany are motor vehicles, chemical products, machinery and optical instruments as well as measurement and control technology and precision engineering products. Products made in Germany enjoy an excellent reputation in Israel and German companies are well positioned when it comes to infrastructure projects.

Israel’s exports to Germany (worth 1.52 billion US dollars in 2016) consist mainly of chemical products and electrical goods as well as precision engineering and optical instruments.

Israeli businesspeople value Germany’s significance as its strongest economic partner in the EU’s single market. Given Israel’s longer-term growth potential, the continuing growth of its high-tech industry, its high level of technical training and its pervading spirit of innovation, which has made the country the world’s second most important start-up location after Silicon Valley, there are promising cooperation opportunities for German business in the country.

Bilateral economic cooperation is regularly a key item on the agenda at the annual German-Israeli intergovernmental consultations, held most recently in February 2016 in Berlin. The focus is on deepening cooperation, particularly in the area of energy efficiency, the transport sector and infrastructure projects.

The Israeli-German Chamber of Industry and Commerce celebrated its 50th anniversary in 2017 and has been part of the German Chamber Network since 1995. It is affiliated to the German-Israeli Business Association (DIW) and is thus equally well networked in both countries.

Bilateral economic exchange is given additional impetus through active cooperation in science and technology. Israel is an important destination for venture capital and modern technologies.

Occupied territories

The Arab-Israeli conflict has given rise to the following special circumstances:

The Palestinian territories (East Jerusalem, the West Bank and Gaza) and the Golan Heights have been occupied by Israel since 1967. The German Government makes a strict distinction between the territory of the State of Israel and the occupied territories. The Israeli Government distinguishes between the territories that are under Israeli jurisdiction (the Golan Heights and East Jerusalem ,which according to Israeli law are through annexation an integral part of Israel and under its full sovereignty), and the non-annexed territories (the West Bank and Gaza).

Settlements

It is the long-standing position of the European Union and its member states not to recognise any changes to the pre-1967 borders that have not been agreed upon by the parties to the conflict. The German Government also takes the view that Israeli settlements in the occupied territories represent a violation of international law, an obstacle to peace and a threat to the fundamentals of a two-state solution.

There are therefore considerable risks associated with economic and financial activities in and for the benefit of settlements. Financial transactions, investment, purchasing and procurement as well as other economic activities (including tourism and other areas of the service sector) in or for the benefit of Israeli settlements give rise to legal and economic risks due to the fact that, from the point of view of international law, Israeli settlements have been built on occupied territory that is not recognised as a legitimate part of Israel’s national territory. German companies and private individuals should also be aware of the reputational risks associated with economic and financial activities in and for the benefit of settlements. The German Government further points to potential violations of international humanitarian law and human rights conventions in connection with settlements in the occupied territories.

For reasons of consumer protection, products made in settlements are not allowed to bear the mark of origin "Israel" in the European Union.

Interpretative Notice of the European Commission

Preferential tariff treatment

Goods produced in Israeli settlements in the Palestinian territories or the Golan Heights are not granted preferential treatment within the scope of the Euro-Mediterranean Agreement establishing an association between the European Communities and their member states on the one hand and the State of Israel on the other (EC-Israel Association Agreement) because they do not originate in Israel. However, there are no specific restrictions on the import of goods. This was confirmed in a ruling of 25 February 2010 by the Court of Justice of the European Union (CJEU) in a preliminary ruling. This case concerned goods which had been produced in an Israeli settlement in the West Bank.

CJEU press release on the Brita ruling

Property acquisition and investment activity

When acquiring ownership and making investments in the occupied territories, especially in the Israeli settlements, it should be noted that any future Israeli-Palestinian peace agreement could have repercussions. Among other things, disputes about the acquisition of land, water, mineral and other natural resources could arise. The Federal Foreign Office does not intervene in disputes of this kind.

The German Government supports projects and project partners in publicly funded programmes only in cases where they are located within the territory that was under Israeli jurisdiction prior to 5 June 1967. This practice is in line with EU directives on cooperation with Israel.

Trade unions

Dialogue between the German Trade Union Confederation (DGB) and Histadrut, the Israeli trade unions’ umbrella organisation, goes back a long way. The DGB and Histadrut have maintained wide-ranging contacts since as early as 1957 – even before the two countries established diplomatic relations. These contacts were formalised in a partnership agreement 40 years ago. Today, cooperation focuses on youth exchange and issues such as the industrial codetermination of trade unions in the face of a globalised economy.

Cultural and educational relations

Germany’s activities in Israel’s cultural and education sectors attract great public interest and are a cornerstone of the work of the German Embassy in Tel Aviv. The German capital Berlin in particular is currently a very popular travel destination, especially for young Israelis.

In its efforts to convey an up-to-date image of modern, cosmopolitan Germany, the German Embassy is supported mainly by Germany’s cultural intermediaries – the Goethe-Institut, the German Academic Exchange Service (DAAD), the Central Agency for Schools Abroad (ZfA) and the Alexander von Humboldt Foundation – as well as the political foundations, the two major Christian churches, the Länder, the approximately 100 town twinning arrangements and private foundations. 

The following actors play a key role in Germany’s cultural relations and education policy in Israel: 

  • the Goethe-Institut through its branch offices in Tel Aviv and Jerusalem; 
  • the German Academic Exchange Service (DAAD) Information Centre in Tel Aviv and the DAAD lecturers and lectors working in Tel Aviv, Jerusalem, Haifa and Be`er Sheva; 
  • the Central Agency for Schools Abroad (ZfA) through its German language advisors, who provide information in Israel on the German Language Certificate (DSD) 
  • the political foundations (who contribute to cultural policy dialogue through their political education activities); 
  • the Catholic and Protestant Churches and the numerous church-supported institutions; 
  • the Länder, districts und municipalities (in particular the approximately 100 town twinning arrangements); 
  • the numerous private foundations (such as the Bertelsmann Stiftung, the Robert Bosch Stiftung, the ZEIT-Stifung Ebelin und Gerd Bucerius, the Axel Springer Stiftung, the Fritz Thyssen Foundation and the Volkswagen Foundation);
  • the German-Israeli Future Forum (DIZF).

Science and research

German-Israeli cooperation in science and research dates back to the late 1950s and is regarded as having paved the way for the establishment of diplomatic relations between the two countries. Initially, the German side was mainly motivated by the desire to make amends for past wrongs. Today, the two high-tech countries cooperate on an equal footing. German and Israeli researchers are jointly laying the ground for future innovations.

With its Weizmann Institute, Technion – Israel Institute of Technology, five universities and a growing number of colleges, Israel boasts an internationally competitive science and research landscape that is very attractive for Germany.

Both countries’ governments support cooperation in science and research. Of particular importance here is the interministerial collaboration between Germany’s Federal Ministry of Education and Research on the one side and Israel’s Ministry of Science and Technology and its Economy and Trade Ministry on the other. A solid foundation for cooperation was laid back in June 2011 with the intergovernmental agreement on cooperation in industrial research and development and vocational training and further education. At the German-Israeli intergovernmental consultations in February 2014, it was agreed to step up cooperation in science and research. This means the two countries will continue to work together in cancer research and research on batteries, as well as expanding cooperation in the area of personalised medicine and water technology. The 2016 German-Israeli intergovernmental consultations focused even more strongly on the importance of innovation, science and research in cooperation and underscored the two countries’ determination to continue cooperation in civil security research, marine research and battery research. The principal aim is to involve small and medium-sized companies and start-ups more closely in the cooperation, initially in the area of applied nanotechnology.

German and Israeli higher education and research institutions cooperate in all scientific disciplines and work together in joint research projects. There is a lively exchange between scientists, academics and students on both sides. Important pillars in terms of project funding are the bilateral programmes of the German-Israeli Foundation for Scientific Research and Development (GIF) and the German Research Foundation’s German-Israeli Project Cooperation (DIP), as well as the programmes of the Minerva Foundation, which also enable scientists to complete research stays in the partner country. In addition, German and Israeli researchers are working together as part of Horizon 2020, the new EU framework programme for research and innovation.

Compensation for National Socialist injustice

Since the conclusion of the 1952 Luxembourg Agreement (payment of some 1.53 billion euros), compensation has been a major political issue in relations between the State of Israel and the Federal Republic of Germany. German compensation payments have so far amounted to more than 74 billion euros, including approximately 29 billion euros to victims of National Socialist persecution now living in Israel. Some 300 million euros is paid out annually in compensation pensions (largely under the Federal Compensation Act) and related payments to recipients in Israel. On top of this are compensation payments for social security and the equalisation of burdens. Following the establishment of the Remembrance, Responsibility and Future Foundation (EVZ) in 2000, compensation was also paid from its funds to former victims of forced labour.

Israeli interests in compensation and restitution are represented by the Jewish Claims Conference (JCC). The JCC disburses one-off payments and monthly pensions to persons suffering hardship who are not eligible for compensation under the Federal Compensation Act. Besides compensation payments to individuals, the JCC receives funding to provide medical and geriatric care to Jewish victims, which is to be substantially increased in the coming years (2014: 142 million euros; 2015: 205 million euros; 2016: 281 million euros; 2017: 315 million euros). In August 2014, the Federal Finance Ministry and the JCC agreed to set up a new joint fund as of 1 January 2015 that will provide for one-off payments for the psychological support of Holocaust survivors who became the victims of persecution during their youth.

More information on compensation for National Socialist injustice

Disclaimer: 
This text is intended as a source of basic information. It is regularly updated. No liability can be accepted for the accuracy or completeness of its contents.

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Germany and Israel are linked in a unique way. The German-Israeli Future Forum Foundation aims to further intensify this special relationship and promote connections between young people in both countries.

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