Profits or Palestine? United Arab Emirates-Israel Agreements Expected to Continue Slowly | Business and economic news
As the residents of Gaza begin the monumental task of reconstruction after 11 days of bombing by the Israeli military that killed at least 254 Palestinians and damaged or destroyed the homes of 80,000 people, another diplomatic cleanup appears to be underway.
Israel’s Ambassador to the United Arab Emirates attended the opening of the Arabian Peninsula’s first permanent exhibition dedicated to victims of the Holocaust in Dubai on Wednesday, saying: “What we see here is the exact opposite of what we see in Gaza… What we see here in the whole process of normalization, it departs from the past. “
UAE de facto ruler Crown Prince Sheikh Mohammed bin Zayed Al Nahyan stepped forward and offered to mediate talks between Israelis and Palestinians in an appeal with Egyptian President Abdel Fattah el-Sisi, the official Emirates news agency reported on Sunday. .
At stake is a week-long ceasefire that ended the latest escalation in violence. After signing the Abrahamic accords brokered by the United States last year, the UAE has become the largest Arab economy to normalize relations with Israel.
Under these agreements, Israel agreed not to annex parts of the occupied West Bank, but no resolution of the Israeli-Palestinian conflict was necessary before economic and diplomatic cooperation between the parties could begin.
Hamas called the agreements a “treacherous blow to the Palestinian cause” at the time, and the Fatah movement criticized the United Arab Emirates for “flouting its national, religious and humanitarian duties” to the Palestinian people.
Palestinian President Mahmoud Abbas used his speech to the United Nations General Assembly in September to criticize the agreements and warn that “the only way to a lasting, comprehensive and just peace” was to end the Israeli occupation and to create an independent Palestinian state with East Jerusalem as its capital.
Now, scenes of Palestinians mourning their dead, standing among the rubble of destroyed buildings in Gaza and fighting forced evictions from their homes in East Jerusalem have left the Crown Prince of Abu Dhabi, known as MBZ, for strike an even more delicate diplomatic balance.
“MBZ appears to seek to demonstrate that its now tarnished relationship with Israel has a redemption value beyond the purely commercial one. With much of the world outraged by Israeli behavior, the UAE’s diplomatic concession seems foolish, ”Jim Krane, researcher at the Baker Institute at Rice University and author of Dubai: The City’s History, told Al Jazeera. fastest in the world.
“Now that Abu Dhabi has formal ties with Israel, it finds itself with less weight with the Israelis and no credibility among the Palestinians,” Krane added.
While the UAE is under pressure from other Arab countries to show support for Palestinian rights, it seems unlikely to quash any deal with Israel to do so, Krane said.
Plans continue quietly for the opening of the Israel-Gulf Cooperation Council Chamber of Commerce and Industry in Dubai, and the UAE-Israel Business Council’s Twitter feed is chock-full of shredder news on kosher catering businesses and the first UAE student to study at an Israeli university.
“Because economic exchange is done mostly at the elite level, and to some extent at the state-to-state level, I doubt we’re going to see much change,” Gregory Gause, head of the department of international affairs at A&M University’s Texas Bush School of Government Public Service, told Al Jazeera.
“What we will not see are efforts to publicize it, certainly from the UAE side,” he added. “They are going to do all kinds of economic transactions with Israel with a lot less publicity.”
A multitude of offers
This potentially new and quieter conclusion of an agreement stands in stark contrast to the wave of announcements in the months following the negotiation of historic normalization agreements between Israel, the United Arab Emirates, Bahrain, Morocco and the transitional government of the United Arab Emirates. Sudan.
As part of the agreements, the United Arab Emirates, Israel and the American International Development Finance Corporation established the Abraham Fund, committing more than $ 3 billion to private sector-led investment and development initiatives.
Israeli tourists have flocked to Dubai on direct flights from Tel Aviv. The UAE has signed agreements with Israel to promote and protect investments in tourism, security, telecommunications, and science and innovation.
Project announcements between companies from the two countries followed in the energy, banking, mobile payment and sports sectors, with Israeli firm Eilat Ashkelon Pipeline Company signing a memorandum of understanding to bring UAE oil to the market. Europe and a royal from the United Arab Emirates buying a 50% stake in Beitar. Jerusalem Football Club.
Yet the total value of capital investments has so far remained modest, with projects from the United Arab Emirates to Israel amounting to around $ 80 million between late September and late March, and projects from Israel to the Arab Emirates. united funds worth less than $ 25 million, said Karen Young, director of the economics and energy program at the Middle East Institute.
“The normalization agreement, the establishment of diplomatic relations, everything is very, very recent,” Young told Al Jazeera. “Many announcements of shared investment funds and commitments are not necessarily on the ground yet. The money has not changed hands.
Future in danger
The potential therefore lies much more in future investments. In April, Abu Dhabi’s Mubadala Investment Co, a sovereign wealth fund with assets worth $ 232 billion, announced it would pay up to $ 1.1 billion to buy a stake in a field of Israeli natural gas – the biggest potential deal to date.
Yet, weeks after Mubadala signed a memorandum of understanding for the gas field deal, footage of Israeli soldiers storming the Al-Aqsa Mosque and firing tear gas at Palestinians, as well as Palestinian families fighting the forced eviction from their homes in the occupied Sheikh Jarrah neighborhood of East Jerusalem, has forced the UAE to respond.
Two major UAE carriers, Etihad Airways and flydubai, have suspended direct flights to Tel Aviv, with Etihad saying it was “in response to the ongoing conflict.”
The government of the United Arab Emirates has condemned the violence in deaf terms, the Minister of State for International Cooperation stressing “the need for the Israeli authorities to assume their responsibilities – in accordance with international law – to protect the right of Palestinian civilians to practice their religion and preserve the historical and legal identity of occupied East Jerusalem, ”according to a statement from the Foreign Ministry.
Krane said the statement shows how the United Arab Emirates and other signatories to the Abrahamic Accords are “walking a tightrope” with respect to the conflict.
“The ruling elites want to secure their regimes using Israeli surveillance and intelligence technology, but the citizens are fed up with the abuse Palestinians are subjected to,” Krane said.
But since the majority of the UAE population is not citizens, “public opinion is not as important to the UAE government as it might be to some other Arab governments on this issue,” said Gause.
The Abraham Accords saw “the already robust enough underground trade come to light,” Krane said, and perhaps because the economic relations of the UAE and Israel are older than their diplomatic relationship, it is likely to stand the test of time.
The two countries are currently producing goods whose other needs are – the UAE imports much of its food, and Israel is a major agricultural producer, Krane said, as well as a supplier of the cyber surveillance technology the UAE uses. . On the other side, the UAE produces goods powered by cheap energy, he explained, such as raw aluminum, glass, fertilizers, petrochemicals and plastics. The two countries have marketed themselves as must-see tourist destinations for citizens of the other.
The deals represented a major shift in the size and scope of what’s possible, Young said, including “major investments by government entities and sovereign wealth funds.”
Israel’s intelligence minister boasted in September that trade between the UAE and Israel would reach $ 4 billion within three to five years. Even with a business relationship still nascent, neither side wants to lose now.
“It is a great test for Israel’s ability to forge ties with the Arab world,” Krane said. “Can he continue to suppress the Palestinians, killing hundreds of them, and maintain relations with countries which openly support the Palestinian cause?” If he survives this test intact and the relationships continue to move forward and the bonds grow closer, that’s a big hurdle.
Young predicts a “period of calm” regarding new trade deals, but said the conflict could also give the UAE an opportunity to become “more activist in its investment commitments”, for example by affecting a certain percentage of investments in job or business opportunities in predominantly Arab regions of Israel, “which was not at all on the table of previous negotiations”.