When Benjamin Netanyahu visited Stephen Harper last May, he was the first Israeli prime minister to visit a Canadian prime minister since Yitzhak Rabin visited Jean Chrétien in 1994.

Ontario Premier Dalton McGuinty brought a high-level delegation of life-science professionals to Israel last May.

Canada and Israel issued a joint postage stamp last April, and last February, the Tel Aviv Stock Exchange (TASE) signed a memorandum of understanding with the Toronto Stock Exchange (TSE).

A memorandum of understanding is a formal alternative to a “gentlemen’s agreement,” which relies on the honour of the parties for its fulfilment.

The Canada-Israel Free Trade Agreement celebrated its 10th anniversary in 2007. That year, the Canada-Israel Industrial Research and Development Foundation celebrated its 13th anniversary; the Canada-Israel Space memorandum of understanding was signed, and the Canada-Israeli Industrial Co-operation Agreement, for the defence sector, was made. Currently, bilateral trade between the two countries stands at well above $1.4 billion.

By all counts, it looks like relations with Canada-Israel are warmer than ever. So why does Alan Baker, the former Israeli ambassador to Canada and current president of the Tel Aviv-based Israel-Canada Chamber of Commerce (ICCC), which aims to encourage commercial relations between the two countries, say they’re not nearly warm enough? Baker reply is that the current state of Canadian-Israeli affairs is just the tip of the iceberg.

Israel has so much to offer Canada: water and military and medical technology, he said. And Canada has so much to offer Israel: heavy industry, oil, diamonds, water and textiles. Not to mention the incredible mutual potential of importing and exporting to each other’s markets, he said.

“With all of the frameworks that we have in place, the relationship is underutilized,” said Baker, a partner of the law firm Moshe, Bloomfield, Kobo, Baker & Co. in Tel Aviv. “In my opinion, the potential should be 200 per cent of what there is right now.”

What accounts for this underutilization? According to Baker, many things. For starters, there are problems on a diplomatic level.

“The Israeli government doesn’t treat Canada as a serious country,” said Baker. Prime Minister Netanyahu’s recent visit aside, when Baker was ambassador, Baker says he used to beg the prime minister – first Ariel Sharon, and then Ehud Olmert – to pop by Ottawa en route to one of their monthly visits to Washington, D.C. “I told them, ‘It will cost you half a day, and you will be expressing gratitude and seriousness to Canada, one of Israel’s best friends and greatest supporters in the UN.’ But it never happened.”

Israel’s military attaché to Canada sits in Washington, yet visits Ottawa only once or twice a year. This is a big problem, Baker said, since Canada’s chief of staff is rejuvenating the army and opening up security contract bids to non-U.S. players. “There is no ongoing Israeli [military] presence in Canada at a time when Canada is ready to absorb Israeli technology like a sponge.”

Baker said the “Israeli government treats Canada like a second-rate country after the U.S. and the countries of Europe… It’s one of the richest and one of the largest. I don’t understand why Israel doesn’t get this.”

On the Canadian government side, there are problems, as well. “The Canadian diplomatic service could do more advertising for Canada,” said Baker. He said the service hasn’t managed to get the Canadian government and Foreign Ministry to exert sufficient influence in Israel. “Israelis have got huge potential, but they need encouragement from the Canadian side. It’s a two-way thing.”

However, that was a bigger issue a year and a half ago, before the Israeli economy started to pick up and Canada started to perk up its ears to Israel’s potential. Around that time, Baker began to work on re-establishing the Canada-Israel Chamber of Commerce (CICC), the ICCC’s sister chamber, located in Toronto. Now headed by attorney David Rubin, the CICC has developed into a thriving, 1,000 member organization of Canadian businesspeople interested in doing business with Israel.

Re-establishing the ICCC, which Baker started to do about a year ago, has been a greater challenge. The 15-year-old organization had been dormant since 2004. Membership had dwindled, and for the last year, Baker has tried to breathe new life into it.

“It is much more difficult to do here [in Israel] than it was to do in Canada. It’s easy in Canada to find enthusiasm for investing in and doing business in Israel. There’s an element of Zionism. But it’s also not primarily a Zionist enterprise. Canadians know that Israel is a powerhouse in terms of technology, medicine and science,” said Baker.

“The reverse isn’t true. There is no ‘opposite direction Zionism.’ And an Israeli company won’t look to do business in Canada because they believe in Canada. They will do business in Canada because there’s a good market, or good financing, and on that level, it’s very difficult for Canada to compete with China, India and the U.S.”

He added that Israelis simply aren’t aware of the potential that Canada offers,” he says. That’s where the chamber comes in. “We want to encourage Israelis to look in the direction of Canada rather than the Far East or the U.S.”

The Israeli economy improved during the Second Lebanon War, proving that the economy could thrive during a period of political and military instability, but that was not always evident to Canadians.

The Canadian media doesn’t help. said Baker, “The average Canadian… tune into the CBC or CTV, or open the Globe and Mail and see negative stuff about Israel.”

Baker doesn’t hold Canadian media bias solely responsible for that. He said it has to do with Israel’s entire public relations  approach, as well. “The whole concept of ‘hasbara’ [literally ‘to explain’] is apologetics. New Zealand doesn’t have to explain anything, France doesn’t explain itself, Russia doesn’t explain itself. Why do we always have to explain what we’re doing?” asked Baker. “Why doesn’t Israel project itself as an economic powerhouse?”

If Canadians knew that cherry tomatoes were developed by Israeli scientists; or that the chip inside their BlackBerry came from Israel; or that when they went for a blood test or an X-ray, Israeli technology is used; or that the metal disks inside the engines of jets were produced by an Israeli company, it would change the way Canadians see Israel, he said.

Added to the mutual problems of perception is a clash of business cultures. While Israelis are innovative and full of good ideas, their lack of formality and impatience is often construed as brash and disturbing by their Canadian counterparts. On the other hand, polite, conservative, more bureaucratic Canadian business culture can be seen as dispassionate, heavy, and square by Israelis.

Baker has dedicated significant chamber resources to educating Israelis about how to do business in Canada.

This past February, he organized an event, co-sponsored by the Ministry of Foreign Affairs and the Canadian Embassy, at the Dan Hotel in Tel Aviv, which was attended by representatives of some 100 Israeli businesses. “It showed me there is interest out there,” says Baker.

The chamber co-hosted an event at the Leon Recanati Graduate School of Business Administration at Tel Aviv University in February, to orient Israelis about the specifics pertaining to listing on the TSE.

Baker would like to conduct similar educational events that host Canadian experts in Be’er Sheva, Haifa and Jerusalem.

He wants to boost the number of business missions the chamber sends to Canada from various sectors, including medicine, agriculture, computers, space, security, water, and even wine-making.