UAE-Israel ties: Opportunities are 'immense' with new free trade deal, minister says

This will open up new opportunities and further connection between the two sides, she adds



by

Michal Michelle Divon

Published: Sat 4 Jun 2022, 7:26 PM

Last updated: Sat 4 Jun 2022, 10:38 PM

This week, a historic free-trade agreement was signed between Israel and the UAE opening up billions of Dirhams worth of trade between the two nations.

Several months in the making, it is the first such agreement with an Arab state and the result of the historic Abraham Accords, normalizing relations between the two countries in August 2020.

Trade is already thriving between the two nations, standing at $1.2 billion in 2021 even before the free trade agreement was in place.

Speaking to Khaleej Times, Israel’s Minister of Economy and Industry, Orna Barbivay spoke of her excitement at the deal. It was signed along with the UAE Minister of Economy, Abdalla Bin Touq Al Marri, in Dubai.

She said: “This is a groundbreaking agreement … and I think the most important thing is that it teaches us that things we once could not have imagined, are right here before our eyes.”

Barbivay says that there will be great benefit to both governments, and citizens of both countries will feel this too. This will open up new opportunities and further connection between the two sides.

“The opportunities are immense, and above all this is a story about people, leaders who weren’t deterred to make decisions that may have been impossible on the past,” she says.

Speaking from Dubai’s Atmosphere Restaurant on the 123rd floor of the Burj Khalifa, Minister Barbivai said the agreement was signed “in no time” due to the great motivation on both sides.

The relationship Israel now has with the Emirati leadership is “inspiring”, she said, the collaborations to follow from such as huge agreement beneficial to both economies. Most duties are to be eliminated immediately, while others will be removed over 3-5 years. Some products will still be subject to customs tariffs but at a lower rate.

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The comprehensive agreement is expected to increase bilateral trade in goods and services to more than $10 billion, increase Israeli exports to the UAE and provide customs exemptions on 96 per cent of trade between the countries: food, agriculture, cosmetics, medical equipment, medication and more.

The agreement also relates to regulatory and standardisation issues, customs, collaboration, government procurement, e-commerce and intellectual property rights.

“Entrepreneurs from the UAE and Israel hearing today’s news will ask themselves, why not expand my business or (take advantage of) the opportunities that have been created by this agreement?,” Barbivai says.

The Minister of Industry and Advanced Technology, Dr Sultan bin Ahmed Al Jaber said the deal showed the foresight of the UAE leadership which “continues to take bold steps forward to advance our economy and improve our status as a regional centre for trade, investments and industries.”

He said the trade agreement with Israel will create a new paradigm for the region, accelerating economic growth. “This agreement represents something larger than business: the importance of building significant partnerships. Our agreement can prove to countries and governments around the world that cooperation and dialogue are the best way to transform challenges to opportunities.”

The UAE Minister of State for Foreign Trade, Dr Thani Al-Zeyoudi, said diplomatic ties had ushered in a new era, showing the power of opening doors. Beyond mere economics, the FTA will create opportunities for research and development, as well as new investments in agricultural technology, renewable energy and advanced technologies, areas of importance to both countries.

“Throughout the last year and a half, we have proven what can be achieved when differences and arguments are put to the side. We are willing to rest on these foundations and to promote a new era of opportunities and entrepreneurship for our citizens, to base our relations on mutual respect, tolerance, open and honest discourse and thought and action. We have no doubt that this agreement will lay the path to a new era of economic prosperity in our region.”

Since the establishment of the Abraham Accords, trade in goods between the United Arab Emirates and Israel has significantly increased, reaching $885 million in 2021, largely due to goods such as diamonds, as well as electrical goods, minerals, fuel and oil.


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