The UAE became one of Israel’s top 20 trading partners as the two countries’ bilateral commerce more than doubled in 2022.
Israel’s ambassador to the UAE, Amir Hayek, said that trade increased by 109.7% to USD 2.56 billion (Dh9.4 billion) in 2022 from USD 1.22 billion in 2021. However, the software business is not included in the statistic. Out of 126 nations, the UAE is currently Israel’s 16th largest trading partner.
Since the Abraham Accord was signed in September 2020, trade between the two nations has increased, particularly since the signing of the Comprehensive Economic Partnership Agreement (Cepa).
By reducing/eliminating tariffs on more than 96% of tariff lines and 99% of trade value, improving market access for exporters, luring new investment, and opening up opportunities in crucial sectors like energy, the environment, and digital trade. The agreement also offers both parties previously unheard-of economic benefits. The two nations hope to surpass USD 10 billion in bilateral commerce in the upcoming years.
In the last ten months of 2022, more than 150,000 Israeli tourists went to the UAE. In the 2010s, Israel and the United Arab Emirates’ informal relations significantly improved, as they started engaging in extensive unofficial cooperation based on their shared opposition to Iran’s nuclear program and regional influence.
Relations between the two countries had been rocky for several decades. Israel established a formal diplomatic office in Abu Dhabi for the International Agency for Renewable Energy in 2015.
Israel and the United Arab Emirates formally agreed in August 2020 to “normalise” relations in a deal mediated by the United States that also requires Israel to halt its plan to annex parts of the West Bank, including the Jordan Valley.
This marked a significant improvement in official Israeli-UAE relations. Israel, the United Arab Emirates, and the United States released a joint statement in which they declared their “agreement to the full normalisation of relations between Israel and the United Arab Emirates.” The signing event took place on September 15, 2020.
Iran and Turkey both criticised the deal. By allowing direct dialling to Israel’s +972 country code, the UAE established phone links with Jerusalem for the first time on August 16, 2020.
On August 31, 2020, an El Al flight became the first direct commercial route between the two countries.
The official Israeli embassy in the UAE was inaugurated on January 24, 2021, with Eitan Na’eh serving as the Chargé d’affaires and acting ambassador.
The United Arab Emirates embassy in Tel Aviv was formally inaugurated on May 30, 2021, with Mohamed Al Khaja serving as the nation’s first ambassador to Israel.