Israel signed a free trade agreement with the UAE today, Tuesday, which is the first major trade agreement for Israel with an Arab country that would reduce or eliminate customs tariffs, and aims over time to increase the annual intra-regional trade volume to more than 10 billion dollars.
The agreement was signed in Dubai by the Israeli Minister of Economy and Industry Orna Barbivai and the UAE Minister of Economy Abdullah bin Touq Al-Marri after negotiations that extended for several months.
Customs tariffs will be raised on 96% of goods, and the UAE expects the comprehensive economic partnership agreement to increase the volume of trade between the two countries to more than $10 billion within 5 years.
UAE Minister of State for Foreign Trade Thani bin Ahmed Al Zeyoudi said on Twitter that the agreement wrote "a new chapter in the history of the Middle East," adding that it "will strengthen trade and investment relations between the two countries, accelerate growth and contribute to the start of a new era of peace, stability and prosperity."
According to official Israeli data, the volume of Israeli-Emirati trade exchange amounted to $1.2 billion in 2021.
Before the signing, the Israeli Economy Ministry said the agreement would eliminate tariffs on food, agricultural, cosmetics, medical equipment, and medicine.
"Together, we will remove barriers and promote inclusive trade and new technologies, which will form a solid foundation for our common path, contribute to the well-being of citizens and facilitate business," Barbivai said on Monday.
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As for the UAE, the free trade agreement with Israel is the second bilateral agreement after it signed a similar agreement with India last February, and negotiations are underway with several other countries, including Indonesia and South Korea, to conclude other agreements, and the UAE is striving to conclude such agreements in an attempt to strengthen its economy after affected by the Corona virus pandemic.
According to the state-run Emirates News Agency (WAM), the agreement aims to consolidate trade and investment relations and stimulate intra-non-oil trade, reaching $10 billion annually within the next five years.
The UAE plans to sign free trade agreements with 8 countries of strategic importance regionally and globally, according to the agency's statement.
The UAE was the first Gulf country and the third Arab country to normalize relations with Israel, and the signing was brokered by former US President Donald Trump in September 2020.
Free trade agreement talks between the two countries began last November, and ended after 4 rounds of negotiations and dialogue, especially on March 21 and 22 in Egypt between Israeli Prime Minister Naftali Bennett and UAE President Sheikh Mohammed bin Zayed Al Nahyan, who was at the time The position of Crown Prince of Abu Dhabi.
The head of the Emirati-Israeli Business Council, Dorian Barak, said that trade between the UAE and Israel will reach $2 billion in 2022, and rise to about $5 billion in 5 years, supported by cooperation in the sectors of renewable energy, consumer goods, tourism and life sciences.
He added in a statement today, Tuesday, that Dubai is rapidly becoming a hub for Israeli companies looking to South Asia, the Middle East and the Far East as markets for their goods and services, and he added that nearly a thousand Israeli companies will operate in and through the United Arab Emirates by the end of the year.