UAE and Israel announced that they would normalize the diplomatic relations in a deal brokered by Washington. UAE Israel trade relations focus on capitalizing splendid economic opportunities and both the countries have made a necessary effort in normalizing relations for the past few months, since the historic deal was signed.
After the UAE Israel agreement, a number of Israeli and Emirati businesses have signed their deals. “Within five years of trade, the UAE Israel trade potential is expected to cross over $4 billion”, a statement according to the Israeli Intelligence Minister Eli Cohen.
What is required under the latest UAE Israel peace agreement?
The agreement promises to establish a normal relationship between the two countries. The normalization includes business relations, direct flights, scientific co-operation, tourism, and a lot more services.
One of the significant components of the UAE Israel deal is the enhanced security cooperation against regional threats, especially from Iran and its proxies. It’s evident that UAE and Israel have security ties, but agreement brings them into open.
Why sign the UAE Israel pact now?
UAE and Israel have been inching toward normalization for years. Israel opened a diplomatic office in Abu Dhabi tied to the International renewable energy agency in 2015. Most of the senior Israeli officials have visited the office and athletes have participated in the regional competitions in the UAE. Similarly, Israel is all set to participate in Dubai World Expo 2020, which is now rescheduled to October 2021 due to the Corona pandemic.
The urge for agreement began when Israel didn’t start the process of annexing West Bank territory as indicated by Netanyahu. Emirates promised to ensure full normalization of relations if annexation was taken off the table. The subtext was published in Israel’s largest newspaper, portraying Israel’s strong desire to widen the country’s formal diplomatic relation with Arab nations or the Middle East. Seizing upon the Emirati signaling, Donald J Trump oversaw the three-way diplomacy and that has resulted in the UAE Israel pact or Abraham Accord.
Impact of UAE Israel deal
The impact of the UAE Israel agreement demonstrates a clear commitment to further diplomatic and commercial relations. From a commercial viewpoint, the deal to cooperate in the economic advancement of the Middle East is expected to create numerous and wide-ranging opportunities. The UAE-Israel pact explicitly refer to several areas where countries intend to cooperate and the areas include,
- Civil aviation
- Tourism, sport, culture
- Agriculture and food security
- Finance and investment
- Legal cooperation
- Innovation, trade and economic relations
Some of the positive developments seen after the UAE Israel peace agreement,
- Opening of the communication channel between the two countries
- Commencement of regular flight schedule between the two countries
- Steps for opening a UAE embassy in Israel
- The bilateral agreement that provides protections and incentives for people who make investment in each other’s countries.
- The announcement that the government-owned Abu Dhabi investment office will open its office outside the UAE in Tel Aviv.
- Announced an establishment of a regional development fund with the purpose of promoting private sector-led investment. The UAE Israel deal will bolster potential trade by enabling strategic infrastructure projects and increase energy through reliable access to electricity.
UAE Israel trade potential – Conclusion
UAE has well-established businesses with a foreign investor-friendly environment. It has a favorable tax regime for both small and large investors. Now, with the help of this agreement, several Israeli businesses and investors will be looking forward to setup or expand their operations in the UAE.
The UAE Israel trade synergies are expected to provide promising development opportunities for the future. The pact enhances economic trade and diplomatic cooperation in both countries. With several other announcements and bilateral agreements, the international market is eagerly awaiting further information on both countries. The combined strategy support business sectors providing a better trade environment for investors!
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