Rich economic dividends of UAE-Israel ties
The peace deal has opened up immense potential for economic co-operation and bilateral investments between the UAE and Israel
The UAE signed a historic peace deal with Israel at a ceremony in Washington on 15 September 2020, in the first such agreement between an Arab country and Israel in over a quarter of a century.
The deal opened up immense potential for economic co-operation and bilateral investments in areas including logistics, aviation, agricultural technology, green energy, and food and water security.
The deal was a game-changer for the region. Since last August, both the UAE and Israel have exchanged ambassadors, opened embassies and established co-operation in areas such as health care, innovation, aviation, environment and energy.
To date, 10 government-to-government agreements have been signed between the two countries including double taxation, visas, financial services and money laundering agreements. Publicly announced deals include around 40 MoUs and around 30 other types of strategic, cooperation or distribution agreements related to the financial, energy, sports, agriculture, aviation, aerospace and media sectors as well as investment promotion and Covid-19 technology.
In July, the UAE opened its embassy in the stock exchange building in Tel Aviv. In June,
Israeli Foreign Minister Yair
Lapid opened his country’s embassy in Abu Dhabi and a consulate in Dubai. Lapid’s visit to the UAE was the first by a senior Israeli minister since relations were established.
In the year since the deal was signed, trade has reached more than Dh2.48 billion ($675.2 million) between the two states, according to figures released by Israel’s Chamber of Commerce (FICC). If current trends continue, it is expected to bring trade by the end of 2021 to around $1.5 billion. The most recent private sector agreement happened in March when the UAE’s Mubadala bought a $1.1 billion stake in an Israeli gas field. According to Dubai Customs statistics on 30 January, the emirate’s trade with Israel in five months (September 2020-January 2021) had reached a value of Dh1 billion. The agreement between the UAE, Israel and the US also established the Abraham Fund, which is committed to mobilising more than $3bn in private sector-led investment and development initiatives to promote regional economic co-operation in the Middle East and the wider region. In March, the UAE announced plans to create a $10 billion fund fully dedicated for investment across Israel in major sectors including energy, manufacturing, water, space, healthcare and agri-tech.
The UAE’s Minister of State for Food Security, Mariam Al Mheiri, signed an agreement to enhance co-operation in food production, supply chains and research during a visit to Israel in June.
Travel between the UAE and Israel has soared since the agreements were signed, with nearly 200,000 Israelis visiting the UAE. The Israeli pavilion at Expo 2020 Dubai, which will open in October, is another stepping-stone in the building of relations, with cooperation in health, education and technology expected to futher build ties. According to Reuters, UAE and Israel will use Dubai Expo as launchpad for $3 billion in trade by 2023-24.
If current trends continue, it is expected to bring trade by the end of 2021 to around $1.5 billion