Israel Germany | Business Guide | 2026

T he year 2025 marked 60 years of diplomatic relations between Israel and Germany. Historically speaking, the economic aspect of the relationship between the two countries began to take shape much earlier, gradually and cautiously, based on the understanding that such a bond is not only political or historical, but also a practical infrastructure for cooperation, trust- building, and the promotion of long-term projects. Over six decades of official relations, an extensive system of trade, investment, research and development, industrial ties, and technological cooperation has emerged. This system has positioned Germany as Israel’s principal economic partner in Europe, and Israel as an innovative and relevant partner for German industry in an era of digital, energy, and security transformation. Economic foundations: from early agreements to formal relations A key milestone in the economic relationship was the Reparations Agreement signed in Luxembourg in 1952 between Israel and the Federal Republic of Germany. The agreement included a commitment to supply goods and services on a significant scale over many years, and constituted an early economic pillar even before diplomatic relations were established. At the time, Israel was a young state in need of infrastructure, equipment, and broad economic support. Diplomatic relations between the two countries were established in 1965 . From that point onward, economic ties took on a broader, more consistent and institutionalized character, marked by growth in trade volumes, increased company presence, and the creation of official mediation mechanisms and business communities on both sides. Institutions and mechanisms: building long-term business trust A central factor in the success of economic relations A historical overview of economic ties, institutional foundations, and prospects for the coming decade Israel and Germany: A 60-Year Economic Partnership at a New Crossroads between countries is the existence of effective “soft infrastructure:” institutions that connect companies, provide information, establish standards, and reduce barriers. In this context, the Israel-Germany Chamber of Commerce (AHK – Israel, German-Israeli Chamber of Industry & Commerce) serves as a representative body of the German economy in Israel and plays an active role in promoting trade relations, investments, andmarket penetration services. In parallel, a governmental and scientific infrastructure for cooperation was developed, including frameworks for research collaboration, vocational training, and inter-ministerial programs. According to official reviews, cooperation in vocational training began as early as 1969 , followed by the establishment of foundations for scientific and technological cooperation between government ministries in the early 1970 s. An additional milestone in strengthening business certainty was the signing of the Investment Protection Agreement in the mid- 1970 s, providing a legal framework for encouraging and safeguarding mutual investments. Science as diplomacy: research and development as a strategic anchor One of the distinctive features of Israel–Germany relations is the central role of scientific and technological cooperation. Rather than emerging as a late addition, this cooperation helped build trust and, in some cases, preceded broader commercial expansion. Over time, it was reinforced through institutionalized joint funds and programs. A prominent example is the German-Israeli Foundation for Scientific Research and Development (GIF), established in 1986 through an agreement between the scienceministers of both countries. Since then, it has served as a key mechanism for financing collaborative research projects. Official German sources emphasize that technological Israel-Germany > Business Guide > Celebrating 60 years of diplomatic relations > 2026 40 > General Information > Historical Overview