The “reciprocal procurement” agreement says Boeing will collaborate with Israeli industries for at least 35 percent of the value of any transaction with the Israeli government. Boeing is vying for several crucial Defense Ministry contracts, such as the purchase of additional F-15 aircraft, fueling planes and transport helicopters, Israel’s Economy Ministry said on Tuesday, Reuters reported.
Israel expects to make about $10 billion worth of military purchases from Boeing over the next decade, which would translate to the company investing about $3.5 billion in Israeli businesses, the ministry added.
The agreement would not only benefit the US aerospace company but also could placate Israel regarding requirements in a US aid package which diverted the use of US funds away from local Israeli businesses. “A reciprocal procurement agreement of this magnitude is a significant achievement that will lead to the growth of many companies in the economy, increase their activity and also their success in international markets,” said Israeli Economy Minister Eli Cohen.
Israel’s new deal with Boeing will partially offset its domestic industry losses from that change.