Growth in leaps and bounds

Bilateral trade between Israel and the UAE is outstripping all expectations, and is further expected to pass a billion dollars this year, according to the Chairman of the Israel Export Institute.

Adiv Baruch said: “We expected it would take a few years to reach a billion dollars annually in bilateral trade, but we are very close to it and we’re exceeding all predictions. By the end of 2021 bilateral trade will be much higher than a billion dollars, and that’s before we even have the figure for technology services.”

Between January and July 2021, trade in goods between Israel and the UAE amounted to about $610 million. Imports from the UAE to Israel totalled $400 million. From Israel to the UAE there were diamond exports of $150 million. Industrial exports were $60 million, three times the pre-Abraham Accords level.

Figures are not yet available for high-tech services such as cyber technologies and artificial intelligence, but these are expected to strengthen the picture of growing trade relations.

“The top parametre here that has helped success is respect,” said Baruch. “There’s also a need for much patience — understanding needs and looking at partners’ strategic bonds to see how you can fit in as well. All of this is happening on a very high level. I believe we still have to continue paving the road but there’s definitely strong will to make this a very effective economic diplomacy effort.”

The Accords were destined to give rise to significant trade from the start, he believes. “They weren’t like the peace agreements between Israel and Egypt or Jordan, countries with which Israel actually had conflict,” stated Baruch, adding, “They were very different.”

Moreover, the pandemic, as a global crisis that had everyone grappling with the same challenges, helped people in both countries to think big and identify new areas for international cooperation. “Covid-19 proved that the world is flat and that physical borders no longer make a difference, and that we’re all equal. It showed us that the only way we can fight and challenge the virus is by joining forces.” This mindset now shapes taking in many areas of trade and business, he added.

Baruch said that talk of areas for Israel-UAE cooperation is constantly growing, and one of the interesting current discussions surrounds food security, with a sense of admiration in the UAE for Israeli success in cultivating arid areas. “Food security is important,” said Baruch. "The UAE imports much of its food. But if Israel cultivates the desert, it’s clear that the UAE, which also has much desert land and limited water, can do the same.”

The pandemic has highlighted Israel’s highly organised digital healthcare system, and the plethora of digital health solutions pioneered in Israel. “Digital healthcare is definitely a growth sector that brings the nations closer together, and so is financial technology,” Baruch commented.

He said that cooperation is being built fast, but methodically. “It started off as a gold rush, but we said we have to do it professionally, building the right contacts and establishing the right trust. We started to see that mature thinkers and business leaders looking for long term partnerships took it seriously on a professional level.

“Ultimately, this is two small counties that have to compete in global competition. Part of the way of fitting in to global competition is with lots of innovation, and Israel is a leader in innovation and actually an innovation hub for the world. As I see it, leaders have taken a brave act and really given our generation the opportunity to make a difference. We received the torch that allows us to make a difference,” added Baruch.