"Good things are happening": Abraham Accords two years on

Participants on Abraham Accords panel, Globes Israel Business Conference  credit: Cadya Levy
Participants on Abraham Accords panel, Globes Israel Business Conference credit: Cadya Levy

An expert panel at the Globes Israel Business Conference looked at regional implications of business ties with the Abraham Accords countries.

The Abraham Accords that Israel signed with the UAE and Bahrain, and later with Morocco and Sudan, changed diplomatic perceptions of Jerusalem’s relations with other Middle Eastern countries, and changed economic relations even more. In the case of the UAE, bilateral trade crossed the $1 billion threshold in 2021.

Still, there are many who believe that the economic potential of the accords has yet to be fully realized. At the recent Globes Israel Business Conference, a panel of experts gathered to discuss lessons learned since the accords were signed, under the topic "A Smart Middle East - Creating an Economic Basis for Diplomacy in the Region".

Oren Cohen, head of Bank Hapoalim’s Corporate Banking division, sees the accords as "much more than a bilateral deal." He said that they had advanced the economy of the region, and had helped in creating warmer economic ties with Egypt. This, he said, was manifest in the memorandum of understanding on the export of Israeli gas to Europe via Egypt, in the expansion of gas sales to Jordan, in US involvement in the Middle East, and even in the maritime border agreement with Lebanon.

"The volume of trade with the UAE has jumped, but Bahrain and Morocco are also moving up," Cohen said. "Fifty-five agreements have been signed with the UAE, Morocco and Bahrain, and several diplomatic and economic missions have been opened. This gives the feeling that it’s legitimate and possible to do business with Israel." Cohen said that Bank Hapoalim was aware of deals in progress on a significant scale that were expected to be signed in the coming year. "We’re talking about an order of size of billions of shekels," he said.

Yariv Becher, VP of Innovation Diplomacy at Startup Nation Central, said that economic opportunities centered on common regional challenges encouraged a two-way track of substantial business activity. At Startup Nation Central, activity focuses on understanding the needs of partners in Morocco, Bahrain, the UAE, and other countries, and providing solutions through linkups with Israeli innovation. In the past year, Startup Nation Central has led several initiatives for building a business infrastructure for advancing cooperation in human capital, building an innovation ecosystem, and so on.

Yael Ravia-Zadok, deputy director general of the Ministry of Foreign Affairs and head of the ministry’s Economic Division, explained that the ministry’s role was to provide the diplomatic infrastructure for business ties and to connect Israeli businesspeople with the right people in the Abraham Accords countries. Asked about delays in obtaining visas for foreign businesspeople, Ravia-Zadok said that the problem was recognized and that there was room for making the treatment of visa applications more efficient.

Despite this problem, trade with the UAE is expected to reach $2.5 billion by the end of 2022, more than double the figure for 2021. Nili Shalev, CEO of the Israel Export Institute, said that the main importance of the Abraham Accords lay in them being a bridge to other countries, particularly Saudi Arabia. She said that it would take time to create cultural familiarity, and that it was a case of a society that was very professional at doing business, and that it was necessary to build relationships of mutual trust.

Dr. Nirit Ofir, founder and CEO of ONational, which deals in business connections between Israeli companies and the Gulf states, said, "Something is not filtering down from government to the private sector, and part of it is that governments need to apply regulation that will make business ties easier." What exactly? Dr. Ofir explained that in Israel there were barriers and laws that prevented such ties. "In every area there are problems, and they need to be diagnosed and solved. No less important is reaching the right people and the decision makers, and not the go-betweens. That’s not an easy task in the UAE," she said.

On a more optimistic note, she said that there were also many successes. "Good things are happening, and we are gradually succeeding. What’s the secret? The ability to bridge the gap between the business cultures of the people from the two countries, and in fact from other countries such as India, as many of the managers at companies in the UAE are Indian, and there’s a real gap in business culture."

Adv. Dana Firon Gross, a partner at M. Firon & Co. specializing in business relations with Morocco, explained that the Abraham Accords had paved a more direct path to the economy and businesses in Morocco. "Morocco has large resources, manpower and natural resources and land areas with high potential. So far, this is being realized in agriculture, defense, exports and collaborations, and hotels, and real estate is also a sector starting to grow," she said.

In what would you recommend Israelis to become involved?

"The government of Morocco has said that it wants to reach 80% renewable energy. They are putting out tenders, and it’s possible to become involved in that, but there are certainly barriers, among them legal barriers." Firon & Co. has links with a French law firm that has offices in Morocco and that assists in removing barriers. One of these is the need for local representation in order to take part in tenders. Another is the taxation question, and the need for a tax treaty between the two countries. Firon Gross said that the private sector in Morocco was ready to do business with Israelis, and that Bank of America had even opened a special desk in Morocco for Israelis.

Back to the Gulf. Despite the lack of diplomatic relations between Israel and Saudi Arabia, Israeli companies are active in the kingdom. Elinor Behar, vice president of business development at consultancy Blue Laurel Advisors, said that Saudi Arabia was different from the UAE in many ways, and that development there, following Crown Prince Mohammed bin Salman’s Vision 2030, was exponential.

Behar said that the Saudis were less interested in buying products than in producing them themselves. They were therefore setting up more and more factories and branches of international companies. Any international company seeking to export to Saudi Arabia was obliged to set up a regional staff there with local partners.

The Gulf states are very interested in med-tech. Galit Perez, head of Clinical Research, Institute for Health Research and Innovation KSM- Maccabi Healthcare Services, mentioned cooperation with the UAE on research into vitamin D deficiency among the varied Emirati population, with its large numbers of foreign workers.

"As soon as the Abraham Accords were signed, we went to the UAE to find the right people," Perez said. "Health organizations like ours with the same spark. We found several partners - the UAE is a partner tailor-made for us. We have a great deal of experience, and we’re learning a huge amount from them about the desire to succeed, and infrastructure. "

The Globes Israel Business Conference is held in cooperation with Bank Hapoalim, with sponsorship from The Phoenix Holdings, Amdocs, BDO, HOT, Geely, Shufersal, El Al, Tnuva, Profimex, The Israel Medical Association, My Desk, Contigo, and Cisco, and with the participation of Mekorot, the Israel Innovation Authority, Mobileye, Startup Nation Central, The Port of Ashdod, and Israel Electric Corporation.

Published by Globes, Israel business news - en.globes.co.il - on November 6, 2022.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2022.

Participants on Abraham Accords panel, Globes Israel Business Conference  credit: Cadya Levy
Participants on Abraham Accords panel, Globes Israel Business Conference credit: Cadya Levy
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