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Israel's status rises in the region while at home economy struggles to recover

Sudan peace deal becomes latest foreign policy victory, but 60,000 Israeli business going bankrupt due to COVID. Here’s what to watch this week.

Israelis wear protective face masks as they walk through the closed down Carmel market, in Tel Aviv, during a nationwide lockdown, on October 26, 2020. (Photo:Miriam Alster/FLASH90)

Here are the stories my colleagues and I are tracking this week:

  • Which Arab countries will be the next to make peace with Israel?
  • How quickly can the Israeli economy recover from the second COVID lockdown?
  • And who will win the American elections and how will this impact U.S. policy towards Israel and the broader Middle East?

Here’s the short version:

  • Over the weekend, the big story was that Sudan became the fifth Arab country in modern history to declare full normalization with Israel.
  • On the domestic front, Israelis are distressed from economic consequences of a national lockdown that began Sept. 18 – and political resentment and protests against the government, and specifically against Prime Minister Netanyahu, continue to grow.
  • So far, 64 million Americans have already voted. Polls show Joe Biden in the lead, but Donald Trump tightening the gap. Election day is next Tuesday, Nov. 3.
Now, let’s take a closer look.

At Home

As Israel slowly exits a lockdown going on six weeks now, we can expect children up through grade four to return to school next week and some business to reopen. But as to which ones — the debate is raging. We are watching as the lobbyists representing various industries present their cases to the coronavirus cabinet this week.

One grim question is which business will not open in 2021. According to a report from Dun & Bradstreet, upwards of 60,000 Israeli businesses will not survive next year.

Already the number of closures in 2020 jumped 70 percent compared 2019.

Israel is also losing its coronavirus czar, Ronni Gamzu, who is scheduled to leave his post at the end of October. A replacement, Nachman Ash, was just announced today.

Gamzu tried to implement a “traffic light” program that would have closed down only “red light” cities, those with high infection rates, while keeping “green light” cities open. That idea was slapped down by the powerful ultra-Orthodox coalition partners since their neighborhoods were first on the list of most-infected with COVID and least willing to obey the rules. But weeks into the national lockdown, and with Orthodox cities no longer on the chopping block, the coronavirus cabinet did impose a five-day closure on a Druze town, Majdal Shams, due to its highest per capita infection rate in the country.

That said, the lockdown appears to have worked its magic.

This week, the Ministry of Health reported only 548 COVID-19 patients in serious condition and fewer than 16,000 active cases, compared to some 900 patients in serious condition and more than 46,000 active cases at the start of lockdown.

Another thing to watch this week is whether the Cabinet will present a budget for 2020.

The deadline for passing a budget is Dec. 23 or the government will be dissolved and the country goes to new elections – the fourth round in two years.

Pay attention to whether the issue of a budget appears on the cabinet’s agenda and whether it is a one- or two-year budget. One stipulation of the power-sharing coalition agreement between Netanyahu and Defense Minister Benny Gantz was a two-year budget that would ensure Gantz’s turn as premiere.

Next Door

We are also keeping an eye on the looming Palestinian financial crisis which is coming to a head.

Since May, the Palestinian Authority cut off all ties with Israel and has refused to accept tax revenues from Israel, totaling $750 million in revenues.

Now, look to European leaders who are expected to turn up the heat on the PA by withholding their own financial aid unless Palestinians accept tax revenues from Israel.


On the world stage, Sudan’s joining of the Abraham Accords was lauded as a score for the Trump administration as well as for Israel.

The United Arab Emirates and Israel immediately shipped millions of dollars worth of wheat to the impoverished African nation. We expect an Israeli delegation to travel soon to Sudan to sign joint cooperation agreements on agriculture, commerce, economy, aviation and immigration.

Now, speculation is growing as to which additional countries might be the next to make peace with Israel. Special attention is being given to Oman and Saudi Arabia, while Morocco is also a possibility.

We are watching a new regional order take shape in the Middle East. One of the driving factors among Arab leaders aligning with Israel and the U.S. is the urgency of creating an effective alliance against Iran.

We will continue to see more cooperation between Israel and her new allies.

Hadassah Medical Organization director general Prof. Zeev Rothstein announced that the UAE wants to open branch of the Jerusalem hospital in Dubai, according to KAN Channel 11 News.

“I’m thrilled that the name of Hadassah has reached the UAE and that they want to bring Hadassah to them,” Rothstein said. “I could never of even have dreamed of such a thing and I pinch myself to check that it is real.”

On another front, expect Israel to join the U.S. in pressuring countries to ignore the recently lifted embargo on selling arms to Iran and refuse to sell weapons to the nuclear-hungry Iranian regime.

U.S. Elections 

Ultimately, all eyes in the Middle East are on the American elections which are expected to have a deep impact in the region.

As we have reported before, Israelis are overwhelmingly pulling for Trump to be re-elected while Palestinians equally hope to see the end of the U.S. president and his policies that have marginalized the Palestinian cause in the region.

“If we are going to live another four years with President Trump, God help us,” Palestinian Authority Prime Minister Mohammad Shtayyeh said.

ALL ISRAEL NEWS is non-partisan.

We are also Evangelicals – please pray for God’s will to be done and for kings, governors and all those in authority, as commanded in scriptures.

No matter what the outcome of these issues — all coming to a head in the next few days — we are in for an interesting journey.

Joel C. Rosenberg is the editor-in-chief of ALL ISRAEL NEWS and ALL ARAB NEWS and the President and CEO of Near East Media. A New York Times best-selling author, Middle East analyst, and Evangelical leader, he lives in Jerusalem with his wife and sons.

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