UAE seeks $1 trillion in economic activity with Israel by 2031

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Israeli President Isaac Herzog (C), UAE Ambassador to Israel Mohammad Al-Khaja (C-R), UAE Minister of State for Food and Water Security Mariam Al-Muhairi and former minister Gabi Ashkenazi, open the Israeli stock market in Tel Aviv in this July 14 file photo. — AFP
Israeli President Isaac Herzog (C), UAE Ambassador to Israel Mohammad Al-Khaja (C-R), UAE Minister of State for Food and Water Security Mariam Al-Muhairi and former minister Gabi Ashkenazi, open the Israeli stock market in Tel Aviv in this July 14 file photo. — AFP

The United Arab Emirates aims to raise the value of economic activity with Israel to more than $1 trillion in the next 10 years, hoping to work together on everything from healthcare to climate change and energy, the UAE economy minister said.

The Gulf Arab state has signed dozens of memorandums of understanding with its new ally in the year since it became the first Arab state to normalise ties with Israel this century.

It was not immediately clear how the two countries expect to reach $1tr in economic activity in the next decade. Each country has a gross domestic product of roughly $400 billion.

The UAE and Israel have between $600 million and $700m in bilateral trade, the minister, Abdulla Bin Touq Al Marri, told a virtual conference on Monday. Reaching that level in one year was “an achievement by itself,” he said.

“We are looking to create over $1tr dollars of economic activity over the next decade,” he said, adding they are “moving into so many areas of economic opportunities”.

Israel says it expects $1bn in trade with the UAE by end-2021 and $3bn in three years, far below the UAE's $24bn of exports in 2019 to its top destination, Saudi Arabia.

“A new window of opportunity has been opened since that agreement, and the economy is changing the face of the region and will offer a diplomatic infrastructure for strengthening ties between us,” said Adiv Baruch, chairman of the Israel Export Institute.

Publicly announced deals include around 40 MoUs and around 30 other types of agreements related to the financial, energy, sports, agriculture, aviation, aerospace and media sectors.

But a $3bn fund announced by the United States, Israel and the UAE on private sector investment and regional cooperation has gone quiet, as has a $10bn fund of UAE private and state money to invest in Israeli strategic sectors.

Israel's Export Institute and Hapoalim, one of Israel's largest banks, said it planned to send a mission of 250 businessmen and entrepreneurs to Abu Dhabi and Dubai next month.

The mission is aimed at companies designated by the UAE as having the potential for cooperation in high tech, as well as companies in construction, industry and smart transportation.

Official Israeli data shows Israel-UAE trade in goods was $610m in the first seven months of 2021, $400m of which was UAE exports to Israel and half of that was diamonds.

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