BREXIT AIR FARE WARNING

A NEW report on British-Israel trade after Brexit has found there is “significant concern” that the cost of flights between the two countries may rise.

In a detailed analysis of future trade relations, the study from the British Israel Communications and Research Centre (Bicom) concluded there is “exceptional potential for growth in bilateral trade and investment”.

But in sectors such as aviation, the study highlighted an urgent need to continue deals negotiated before the Brexit vote.

The price of plane tickets on routes to Israel is currently governed by the European Union Open Skies agreement.

James Sorene, Bicom’s CEO said: “Britain-Israel air routes have been made more competitive by the entry of budget airlines like Wizz and EasyJet.

“If that were to be limited due to problems under the Open Skies agreement, then people would be limited to using just the flag carriers — El Al and British Airways. As a result of less competition, prices are likely to go up.”

More positively Bicom found there has been a 28 per cent increase in Israeli companies setting up in the UK in the year after the 2016 Brexit referendum.

The consensus among officials from both countries was that a bilateral freetrade agreement should be agreed as soon as possible.

The study noted that agriculture products constitute a significant share of British imports from Israel. A free-trade agreement could lead to an increase in produce coming from Israel, greater competition with other foreign producers and lower food prices for British consumers.

“At present there is a quota on certain products, “said Mr Sorene. “If there is a deal between Britain and Israel, you could see cheaper fruit and vegetables.”

The report also warned that a new UK-Israel trade agreement must exclude customs duties on medicines to avoid significant increases in the NHS drugs bill. Currently one in seven NHS drugs are bought from Israeli pharmaceutical companies.