Seoul, South Korea
Seoul, South KoreaThinkstock

In a first-of-its-kind move, Israel has reportedly agreed to exclude Jewish communities beyond the pre-1967 'Green Line' from a free new trade agreement with South Korea, Ynet reported.

The deal, which is expected to be announced during South Korean Trade Minister Yoo Myung-hee's visit to Israel next week, will include a provision specifically excluding products made in Judea, Samaria, and the Golan Heights.

Under the agreement, goods originating within pre-1967 Israel would be exempt from customs fees.

Israeli officials reportedly view the deal with Seoul is strategically important as the first such agreement with a major Asian power.

Bilateral trade with South Korea is currently estimated to total $1.5 billion annually, and is expected to rise significantly under the new free trade agreement.