Although the year 2020 witnessed 4 Arab countries heading to normalization with Israel (the UAE, Bahrain, Sudan and Morocco), the UAE was the fastest in implementing partnership, economic and commercial integration deals with Israel.
The last of these agreements was what was indicated by Reuters and various media outlets, to open the way in the Dubai Gold and Commodities Exchange for Israelis to register their companies in it and enter their trading platforms.
According to Reuters, the Dubai Stock Exchange announced that "the way is open to launch its products and services, such as futures and options that cover the precious metals, energy, commodities and currency sectors, in Israel with the expansion of derivatives trading in the Middle East."
After the announcement of the full normalization of relations between the UAE and Israel in September 2020, Reuters reported that one of the largest Israeli diamond dealers, Zvi Shimsi, had gone in October 2020 to the UAE to establish his diamond trade company, and the man had previously gone to the Emirates. With a German passport, but this time he went to establish his company with his Israeli passport.
For further clarification, options contracts are contracts between two parties that give their purchaser the right, not the obligation, to buy or sell a certain amount of shares or a certain commodity at a specific execution price during the period of validity of the contract, and the option buyer pays for receiving this right a certain amount, called the price of the option, It is a small amount of the share price, or commodity, price.
Some believe that the undeclared Emirati-Israeli relations had started before that, as they consider that the acceptance of the UAE's membership in the World Federation of Diamond Bourses in 2004, with the approval of 22 countries and without Israeli objection, was a real start in an important trade field, which has its big investors. The first step is for Israeli merchants to attend the Dubai markets in the fields of gold, diamonds, jewelry, and other fields.
The UAE opened the way on the Dubai Gold and Commodities Exchange to Israelis for the possibility of registering their companies in it (communication sites)
The place of gold in the UAE's foreign trade
Gold and jewelry represent an important element in the UAE's foreign trade, according to the annual statistical report for the year 2019, issued by the Ministry of Economy in the UAE, as the UAE's exports of gold in 2019 amounted to about $ 18.5 billion, while its imports in the same year of gold amounted to 32 One billion dollars, and the UAE’s gold exports represent 28% of its non-oil merchandise exports, and the UAE’s imports of gold represent 13%.
The UAE’s trade in gold, other than raw gold, includes jewelery and jewelery and their parts. The UAE’s exports of jewelery in 2019 were estimated at $ 2.4 billion, while its exports of jewelery and parts due to re-exports amounted to about $ 14.7 billion, which represents 11%. Of the proceeds from re-exports of non-oil goods in the UAE.
The UAE's imports of jewelery and jewelry and their parts in 2019 amounted to about $ 15.1 billion, which represents 6% of total merchandise imports, and the report's statistics also included the UAE’s imports of diamonds in the same year, which amounted to $ 10.9 billion, representing 4% of total imports. Commodity.
Jewelry and diamond trade in Israel
According to available data, Israel's exports of jewelry and precious metals in 2019 amounted to 13.4% of total merchandise exports, and it is worth noting that merchandise exports to Israel in 2019 amounted to $ 58.5 billion, which means that exports of jewelry and precious metals reached $ 58.5 billion in 2019. Worth $ 7.8 billion.
As for the diamond trade, a report issued by the Israel Institute of Exports in March 2020 stated that Israeli exports of diamonds amounted to $ 4.8 billion, and it is worth noting that the diamond ore is not available in the Palestinian territories occupied by Israel, but Israel depends on importing it as raw. Manufactures and re-exports it.
Israel relies on importing rough diamonds from African countries, but it is usually within the framework of reciprocal deals in so-called diamonds in exchange for arms, and thus Israel is fueling wars and bloodshed in these poor countries, just as the UAE does in importing gold from African countries.
And after the signing of the normalization agreements between the UAE and Israel, those in charge of the diamond industry in Israel were optimistic that the matter of trade between them in diamonds will flourish, because Israel will manufacture and Dubai will sell, as the diamond market in Dubai includes a thousand companies registered there.
The UAE's gold exports represent 28% of its non-oil merchandise exports (Reuters)
Semantics of the event
The move to open up the Dubai and Israel stock exchanges to each other comes as a step within the targeted economic and commercial normalization between them, and there are indications for this event, which may not be limited to this step, but rather aims for cooperation between two countries that enjoy cash savings from oil and natural gas revenues.
This cooperation may push to invest in the two stock exchanges, to establish companies, expand existing companies, or take major steps in order to control significant shares of the global trade in gold, diamonds and gem stones, and it is not excluded that the two countries seek to monopolize or control the gold and diamond trade. In the Middle East.
In light of the small population in the two countries and the existence of financial savings, this will be encouraging in rentier investments, such as trade in gold, diamonds and gem stones, thus leading to Israel not suffering from the so-called "Dutch disease" in order to maintain a balanced exchange rate for its currency.
The impact of the move on money laundering
In April 2019, Reuters published a report entitled "Forbidden trade ... the UAE is a major gateway in smuggling billions of gold from Africa." The UAE, which opens the door to major corruption practices, on top of which is money laundering.
It is also considered one of the financing of wars in African countries, where local conflicts are frequent, and a large segment of the peoples of these countries are deprived of development projects, and the exit of their people from the state of extreme and permanent poverty for decades.
In light of this cooperation at the level of gold exchanges between the UAE and Israel, there is fear that there will be organized activities to loot more of the wealth of African countries, especially gold, precious stones and precious commodities, given that the UAE over the past two decades has expanded significantly within African countries, and in projects Port management, agriculture and the communications sector in particular.
The UAE’s control over some ports would facilitate the easy entry and exit of gold, diamonds and other valuable commodities from African countries for the benefit of both the UAE and Israel.
In general, the UAE, and Dubai in particular, is known as one of the prominent destinations in which money laundering rates are high in the world. The Basel Institute report on the Money Laundering and Terrorism Financing Index ranks the UAE 72nd out of 146 countries included in the report. Arab countries The UAE is ranked sixth according to this indicator.