Israel-UAE relations economic milestones: The dynamic relationship develops

Israel and UAE economic initiative news


Israel and the UAE are rapidly fostering relations that look set to build a powerful alliance between two of the Middle East’s most dynamic economies. The two states share much in common in terms of regional strategic views and also having carved out economic success in a region that has many states that are struggling economically or may be worse off in some ways than they were decades ago. When it comes to infrastructure, Israel and the UAE are putting in place new roads and railways and buildings at a rapid pace as their populations grow and they become world leaders in parts of the global economy.

The only surprise here may be that this alliance didn’t emerge decades ago. Nevertheless as it comes into fruition, with cultural, religious and now visa-free travel, it has a lot of potentil.

This post will include some details about the new relationship, and may be updated as things develop.

A UAE delegation arrived in Israel on October 20. Four cooperation agreements have been signed. These included the visa-free travel, and deals relating to investment, science and technology and flights. The agreements also include an Abraham Fund that will start with $3 billion in trilateral investment. The Jerusalem Post notes “US International Development Finance Corporation CEO Adam Boehler announced the fund on the tarmac at Ben-Gurion Airport, where a ceremony was held in honor of the first Emirati government delegation to Israel, led by UAE Financial Affairs Minister Obaid Humaid Al Tayer. Prime Minister Benjamin Netanyahu ‘asked us to come to do everything we could to turn the words of the accords into action and invest behind these accords and support other countries as they support these accords,’ Boehler said. ‘People are tired of the same and want economic security and jobs that come from enduring peace.’”

Important US and UAE officials are linked to the October 20 meetings. These include Al Tayer and US Secretary of the Treasury Steven Mnuchin, as well as Avi Berkowitz, the US Special representative for international negotiations.

Much progress has already been made.

Let’s remember the context.  I have written on Israel-UAE relations frequently, such as this piece at Bloomberg and also at The Atlantic Council, the Daily Beast and The Jerusalem Post. (See other articles here, here and here and here).

Back in October 2018 Netanyahu made a trip to Oman that marked a major breakthrough in Israel’s attempts to develop ties with Gulf Arab countries. Israeli Minister Miri Regev travelled to the UAE in October 2018. There was widespread speculation at the time about possible relations, perhaps between Israel and Bahrain at first.

Israel and the UAE already shared concerns about Ankara’s aggressive stance in the region and also about the Muslim Brotherhood, in which Hamas has roots. Israel had also expressed concern in October 2019 about threats from Yemen, where Iranian-backed Houthis are fighting a Saudi-led alliance that has at times included the UAE. The UAE is also close to Egypt, Jordan, Cyprus and Greece; countries that are close to Israel and which form part of the EastMed gas forum.

Subsequent months involved a Chad leader’s surprise meeting with Israel’s Prime Minister and then in June 2019 Bahrain hosted the “Peace to Prosperity” workshop prior to the January 24, 2020 Trump rolling out the peace plan.

Israel also confirmed participation in the 2020 Expo in Dubai.

A February 4, 2020 Uganda secret Sudan meeting followed and on May 19 Israeli officials said a UAE flight delivered humanitarian aid to Israel during the Covid crisis. This was a symbolic flight. A second flight took place soon after. On June 12 the UAE’s ambassador to Washington Yousef Al Otaiba wrote an oped in Israel’s largest circulation daily. On July 6, 2020 IAI and Rafael and the UAE’s Group 42’s CEO Peng Xiao, signed a deal to work together against Covid. On August 13, 2020 UAE Minister of State for Foreign Affairs, Anwar Gargash, announced the UAE’s agreement to normalize relations with Israel.

US Secretary of State Mike Pompeo flew to the region on August 23, to Israel and then direct to Sudan (the first flight of its kind) and then to Bahrain and the UAE on August 26.

On August 31 the first flight from Israel with the EL Al, with Jared Kushner and a delegation from Israel and the US on board, the ‘Kiryat Gat’ plane flew from Israel to the United Arab Emirates. On September 4 a deal with Kosovo and Serbia was pushed through by Trump and on September 11, Bahrain says it would establish full diplomatic relations with Israel. Days later on September 15 the Abraham Accords were signed in Washington.

Group 42 also said it would open an office in Israel on September 13.

UAE Foreign Minister Abdullah bin Zayed said ““I stand here today to extend a hand of peace and receive a hand of peace.”
Israel entered a lockdown soon after. Rumors about Sudan normalizing relations were dashed on September 26 (“sources say US officials indicated they wanted Khartoum to open ties with Israel, following in the UAE and Bahrain’s steps”) but revived on October 19 when the US announced it would take Sudan off its terror sponsor list. Oman said it welcomed an agreement but would wait. Kuwait’s Emir died and Morocco slammed Israel at the UN.

Israeli Defense Minister Benny Gantz told reporters from the Gulf that Turkey was opposed to regional peace.

October 6, “Israeli investment platform OurCrowd has signed a memorandum of understanding with business development company Phoenix, to increase business and tech ties between Israel and the United Arab Emirates (UAE).”

Israel’s Knesset approved the agreement on October 15 and the UAE followed days later. UAE anti-terror chief Dr. Ali al-Nuaimi said “We need to pool all resources to work together to counter terrorism,” he said. “They [terrorists] are across borders; they are everywhere. It’s our responsibility as Muslims to get back our religion and to show it to our kids as a religion of peace.”

On Sunday October 18 Israel and Bahrain signed an agreement to normalize ties as the first Israeli flight arrived in Manama. Bahrain Foreign Minister Abdullah Bin Rashid Al-Zayani, who had signed the declaration in DC and Undersecretary of International Affairs Abdullah bin Ahmed bin Abdullah Al-Khalifa greeted the Israeli delegation.

A new UAE-Israel business council has also been created. There is also a new Gulf-Israel Women’s Forum. Leaders in the business and women’s council include Fleur Hassan Nahoum and Dorian Barak. The Jerusalem Post noted “Jerusalem deputy mayor Fleur Hassan met with Khalaf Al Habtoor, founding chairman of the Al Habtoor Group, a large conglomerate headquartered in the UAE, to discuss economic ties between the UAE and Israel.”

On October 20 Mnuchin came with the UAE delegation to Israel.  He said he was honored to represent President Trump. He had recently participated in a business confab in Abu Dhabi between Israel and the UAE. He flew on the first commercial flight from the UAE to Israel. He said the new ties create a tremendous foundation for innovation, prosperity and economic growth. Stronger security would follow, he said. He also said that the US, UAE and Israel share views on threats in the region.

An Israeli pipeline company EaPC will also conduct a preliminary deal to transport oil from the UAE to Israel through a pipeline from Eilat to Ashkelon. Globes report is here.

Etihad airlines calls it a dawn of a new era. Direct flights and visa wavers are key to new relations.

Mohammed Bin Zayed said on October 12: “During a phone call with Israeli Prime Minister Benjamin Netanyahu, we discussed strengthening bilateral ties and examined prospects for peace and the need for stability, cooperation and development in the region.”

On October 6 the UAE’s Abdullah Bin Zayed and Israel’s FM Gabi Ashkenazi went to the Holocaust memorial in Berlin.

The first cargo ship arrived in Israel from the UAE on October 12 and a new rabbi was named in the UAE.

The October 20 ceremony at Ben-Gurion saw Netanyahu achieve some of his goals and dreams regarding the concept of peace through strength. Ynet noted that Netanyahu was “accompanied by Foreign Minister Gabi Ashkenazi and Finance Minister Israel Katz, the prime minister hosted the Emirati delegation – including the UAE’s Minister of State for Financial Affairs Obaid Humaid Al Tayer and Economy Minister Abdullah bin Touq al-Mari – at a special five-hour ceremony confined to Ben-Gurion Airport due to coronavirus measures.”

The Trump administration has also achieved some of its goals. Reports on the same week indicated it was also seeking to get back US citizen Austin Tice from Syria.

The maritime shipping line, inaugurated by the MSC Paris, is historic, as is possible investment from DP World in Haifa port.

Article at Khaleej Times.

Israeli singer Elkana Marziano and Emirati artist Walid Aljasim’s song ‘Ahlan Bik’ clocks more than 1.1 million YouTube views. (First reported in late September). Back in August reports also said “Israeli pop star Omer Adam said in talks to perform in UAE.”

October 24

Reactions to Sudan-Israel normalization. Trump announces historic deal. UAE welcomes Sudan decision.

Ynet: Saudi relations are a long way off.

Calcalist; Israel-UAE ties must be based on trust.

Al-Jazeera; Israel won’t oppose US weapon sales to Gulf. “

Israel will not oppose the sale of F-35s to the United Arab Emirates, Jerusalem announced on Friday night.The joint announcement by the offices of Prime Minister Benjamin Netanyahu and Defense Minister Benny Gantz came after Gantz returned from Washington where he met with his US counterpart Mark Esper and signed a deal that ensures Israel’s qualitative military edge in the region.”

Netanyahu and Gantz still have different stories about the F-35 deal.

Saudi ties could come after election.

Israel and Oman discuss ties

Egypt supports Sudan-Israel ties.

October 27

Jpost: Hadassah head in negotiations with UAE to open hospital.

“Israel-UAE peace down under” conversation by Zionist Council of NSW “

We are so excited for our special event this Tuesday with @omaralbusaidy – Author, Dreamer, Scholar, Entrepreneur – from UAE, who will be discussing the historic peace agreement with Israel.”

Israel Golan Heights wine to be sold in UAE.

TOI: Virtuzone, an Emirates–based firm that helps companies set up operations locally, has formed a joint venture with APEX Holdings, an operator of firms in the UAE.

Bloomberg: An Israeli businessman, who’s been operating in the United Arab Emirates’ commercial hub of Dubai for the past 14 years, is in talks to buy Israel’s Israir Airlines, hoping a new normalization pact between the countries will offer an opportunity for expanded operations.

Arab News survey points to support for peace.

Calcalist: “A month after the UAE and Israel signed the historic Abraham Accords, a new cross-business initiative led by Tel-Aviv based consultancy firm Kamir Strategy and UAE-based PR firm Cosmopole has been launched with the goal of connecting Israeli ventures with UAE companies and investors in the field of biomed.”

Breaking Defense: “Our first story from our new Middle East bureau appears below. Riad Kahwaji, perhaps the most respected defense journalist in the region, details for our readers the remarkable progress Israel and the UAE have made in less than six weeks and compares it to the adumbrated results of the 41 years that have passed since Israel and Egypt made peace. You’ll be seeing much more of this sort of excellent coverage for us from Dubai. Read on! The Editor.” He reports: that abdulkhaleq Abdullah, a professor of political science from the UAE, told me. “But the Israelis should be aware that the UAE will not take lightly any attempts to carry out espionage on its territories and will not accept moves to hinder the F-35 deal.”

Newsweek: Seth Frantzman on cementing Israel’s ties with Gulf.

November 2

Chevron Middle East deals in spotlight as company reportedly eying importance of Israel, Qatar and region.

AFP: From hummous to hi-tech: “After normalization of ties between the two countries, covert links between the Gulf nation and Israel’s flourishing technological sector are set not only to come to the surface, but actually expand.” Palm tree tech stands out here, “Ben Hamozeg is the founder and chief executive of Agrint, a company that uses seismic sensors to detect insects that eat — and destroy — palm trees from the inside.”

AP: “Israel’s delegation was led by big-time venture capitalist Erel Margalit and his entourage of 14 startup executives, photographers, foreign journalists and PR people; some Palestinian entrepreneurs had also flown with the delegation.”

Jerusalem Post: Israel defense companies to be at IDEX Feb. 21-25 in Abu Dhabi. Among those who will reportedly attend include IAI, Rafael, SmartShooter and Bird Aerosystems.

Media Line:  “A dozen Israeli and Emirati women – including Jerusalem’s deputy mayor and a Hebrew-speaking professor born in Abu Dhabi met last week in Dubai to discuss life, work and the future, creating a space to exchange cultural and business ideas.” For background on this see the Arab News report on October 9 and Israel HaYom on October 11.

TOI: UAE ratifies mutual visa exemption.

Jerusalem Post: Israel receives permission to begin fruit and vegetable exports to UAE.

Al-Monitor: New normal for UAE, Israel Palestinians.

Foreign Policy looks at the role of Mahmoud Dahlan in the UAE.

Other news: Soccer leagues signed an agreement, as did lawyers groups about IBA conference, 28 weekly passenger flights in the offing.

F-25 News: Hurdles remain despite Trump support (CNBC) and White House attempt to move forward with sales, Biden team appears to say only Israel should have the plane (TOI), while “Democrats build speed bumps” in Congress (Defense News).

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