The First Of Its Kind
The United Arab Emirates (UAE) has become the first Arab nation to sign a Free Trade Agreement (FTA) with Israel. Israeli Finance and Industry Minister Orna Barbivay and Minister of Economy of the UAE Abdulla Bin Touq Al Marri signed the accord in Dubai on June 1, 2022. Before signing the FTA, the two West Asian nations held talks in this regard for nearly two months.
In recent times, the Arab nations have strongly criticised the Jewish State over the death of a female Palestinian journalist. Diplomats are still not sure whether this historic agreement would increase the anger of the Arab world in the coming days. Shortly after the two ministers signed the agreement in Dubai, Amir Hayek, the Israeli Ambassador to the UAE, tweeted: “Done… The UAE and Israel signed an FTA.” He said that the move was aimed at boosting bilateral trade ties.
Mohamed Al Khaja, the first Ambassador of the UAE to Israel, too, has described the deal as unprecedented. He claimed that both the countries would benefit from this FTA, as they would get an opportunity to explore each other’s markets. The move would ultimately boost employment opportunities, as well as mutual cooperation, added the envoy.
Meanwhile, business experts are of the opinion that thousands of Israeli companies would start ventures in the UAE by the end of 2022 because of this agreement. They would also be able to expand their businesses in South Asia, South-East Asia and the Gulf region through the UAE. Before signing the FTA, Barbivay stressed that 96% products, including food items, agricultural products and medicines, would be customs free. The UAE is confident that the volume of bilateral trade would exceed USD 5 billion in the next five years. At the same time, peace and prosperity will increase between the two countries.
Speaking at a press conference, Dorian Barak – the Co-founder of the UAE-Israel Business Council – said that the UAE-Israel trade would have untold benefits in the coming years. “UAE-Israel trade will exceed USD 2 billion in 2022, rising to around USD 5 billion in five years, bolstered by collaboration in renewables, consumer goods, tourism, and the life sciences sectors. Additionally, Dubai is fast becoming a hub for Israeli companies that look to South Asia, the Middle East and the Far East as markets for their goods and services,” he added. Barak further said: “Nearly 1,000 Israeli companies will be working in and through the UAE by year’s end. It’s unprecedented.”
It may be noted that the UAE and Israel formally established ties in 2020 as part of the US-brokered Abraham Accords, which also included Bahrain and Morocco. This FTA is also Israel’s first with an Arab nation.
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