Israel and the United Arab Emirates on Wednesday inked an agreement to foster business and manufacturing ties and boost relations with institutions in industry, trade, and investment.
The Manufacturers’ Association of Israel (MAI), the umbrella organization for industrial and manufacturing companies, signed a memorandum of understanding with Ras Al Khaimah Economic Zone (RAKEZ), a government-run business and industrial hub and free-trade zone in the emirate of Ras Al Khaimah.
The agreement signed by RAKEZ chief government and corporate relations officer Yaser Abdulla Al Ahmed and MAI’s deputy CEO Hagai Edri seeks to create investment and expansion opportunities for industrial and manufacturing companies in the UAE and Israel. The goal is to boost industrial operations and help business communities in both countries, as well as strengthen their economic ties, RAKEZ said in a statement.
“It is important that we take steps towards enhancing the level of cooperation between the UAE and Israel through economic exchange,” said RAKEZ Group CEO Ramy Jallad. “We believe that our partnership with the Manufacturers’ Association of Israel will create new gateways for industrial players in both countries to expand their regional footprints.”
The MAI represents some 1,800 industrial firms and manufacturers in Israel in areas such as high-tech, textiles, fashion, chemical, pharmaceuticals, environment, food, metal, electrical, infrastructure, and consumer products. RAKEZ is a business and industrial hub established by the government of Ras Al Khaimah in the UAE that hosts over 18,000 companies, startups and entrepreneurs coming from more than 100 countries and operating in more than 50 industries.
As part of the MOU, the two organizations will be hosting business delegations and business events such as seminars and workshops to connect industrialists in Israel and the UAE and provide them with networking opportunities.
Trade between Israel and the UAE has been growing since the so-called Abraham Accords that normalized ties between Jerusalem and Abu Dhabi in 2020. The accords established diplomatic relations between Israel and the UAE and Bahrain and paved the way for increased and open economic and other cooperation. Sudan and Morocco also signed normalization agreements by the end of 2020 as part of the framework, though Sudan is yet to follow through amid internal divisions.
“We see RAKEZ as a potential strategic partner that will allow Israeli industries to expand to other markets while maintaining their main industrial activity in Israel in a way that will benefit both organizations, their members and their respective economies,” commented Edri.
In March, the UAE and Israel signed the final, and most important, component of a free trade agreement between the two countries. The agreement lowers or eliminates tariffs on more than 96 percent of tariff lines and 99% value of trade between the two countries. The FTA covers regulation, customs, services, government procurement, e-commerce, and the protection of intellectual property rights.
As a result, some 96% of products traded between the countries, including food, agriculture, cosmetics, medical equipment, and medication, will be exempt from customs duty, according to the deal.
In the first five months of 2023, the trade of goods (excluding software) between Israel and the UAE rose 41.5% to $1.29 billion from $912.5 million during the same period last year. In 2022, trade between Israel and the UAE jumped 124% to $2.59 billion year-on-year.
Over 35 business agreements were signed in 2022 between Israel and the UAE for cooperation in the fields of health and environment, agriculture, security, and water, according to the Abraham Accords Peace Institute.
In June, Sheba Medical Center in central Israel announced a new multifaceted strategic partnership with the UAE’s PureHealth, the largest integrated healthcare platform in the Middle East. PureHealth and Sheba will share research and knowledge about common illnesses like diabetes, ischemic heart disease, and a variety of chronic conditions.