JERUSALEM—In the non-fiction book I wrote last year, I predicted a “gold rush” in the Middle East as a result of the historic peace and normalization deals between Israel and four moderate Arab states.
And we now have proof such a gold rush is in motion, despite the COVID pandemic, Iranian and Houthi terrorist attacks, a complete change in the Israeli government and other challenges.
What’s more, the region is poised for enormous additional growth, and global investors understandably want in.
A new report published yesterday by the Abraham Accords Peace Institute – founded last year by Jared Kushner, the architect of the deals – provides specific details that are both startling and exciting.
According to the Abraham Accords Progress Report 2021:
· Trade between Israel and the United Arab Emirates in 2021 shot up an astounding 511% from 2020 to $1.15 billion.
· Trade between Israel and Bahrain in 2021 grew from 0 in 2020 to $6.5 million – modest, but an important start.
· Trade between Israel and Morocco in 2021 jumped 84% over 2020 to $41.6 million.
DOES A RISING TIDE LIFT ALL BOATS?
Commerce between previous Arab-Israeli peace partners is also rising.
Trade between Israel and Egypt in 2021, for example, grew 43% over 2020 to nearly a quarter of a billion dollars ($246.1 million).
The figure is less than 25% of Israel’s trade with the UAE, a new peace partner, even though Israel first signed a peace treaty with Egypt in 1979, more than 40 years ago.
Still, the number strikes me as encouraging because the 43% increase comes after four new Arab states made peace with the Jewish state.
And there’s tremendous room for growth given the proximity of the two countries, and Egypt’s 100 million consumers.
Even more encouraging were the 2021 trade numbers between Israel and Jordan, up 83% from 2020 to nearly a half-billion ($455.8 million).
The two neighbors signed their peace treaty in 1994.
Yet there have been significant political strains between them ever since, and even more so in the last few years.
So, it’s incredibly noteworthy to see that Israeli-Jordanian trade is almost twice Israel’s trade with Egypt, and growing at double the rate.
Apparently, a rising tide does lift all boats.
WHAT DOES THE FUTURE HOLD?
In addition to listing in their report dozens of specific trade, investment, people-to-people and diplomatic agreements that have been signed since the Abraham Accords, the authors of the institute report made a number of assessments, based on the data.
“Since the historic agreements were reached last year there has been remarkable progress -- and yet we all recognize there is even greater potential ahead,” they noted. “We look forward to working with the Accord members and our partners to assess progress made in the past year and the conditions which should be preserved or expanded and identify obstacles and impediments which constrain trade and investment which must be resolved. It should inform and guide our efforts to establish priorities and streamline processes leveraging cooperative effort to achieve the full potential between and among Accords members.”
“While the historic Abraham Accords have led to an exciting surge in economic ties between Israel and its new Arab partners, the Accords’ promise goes much deeper than bilateral business deals,” the authors wrote. “The peace agreements have the potential to transform the region, creating a new Middle East corridor of prosperity, stability, and trade. 2022 will be a critical year for realizing this potential. While the Abraham Accords have the potential to transform the region, such a transformation will not happen on its own. We must focus our time, energy and effort on those actions which serve to liberate the economic potential of the Accords, adopt a strategic approach which utilizes the unique contributions of each member, cut through bureaucratic red-tape, and account for integration with global markets. As the enormous benefits of this win-win regional cooperation become increasingly clear, more countries will likely join the Abraham Accords, thereby creating a virtuous circle of peace and growth.”
PREDICTIONS – AND POSSIBLE COMPLICATIONS
“For the first time in two thousand years, people in the vortex of the Middle East suddenly think such a new way forward is possible,” I wrote in my latest non-fiction book, “Enemies and Allies: An Unforgettable Journey inside the Fast-Moving & Immensely Turbulent Modern Middle East.” “That alone is extraordinary. Indeed, business leaders, entrepreneurs, CEO, investors, and venture capitalists I have spoken to throughout the region believe a new gold rush is being set into motion.”
“What was a trickle of contact and contracts before is now growing into a tsunami of ultimately billions of dollars of bilateral investment, joint ventures, and joint venture creation and research,” says Jon Medved, a leading Israeli investment strategist for a firm called OurCrowd. “When two entrepreneurial countries like the UAE and Israel get together, just watch the sparks fly and real value get created.”
Jason Greenblatt, who left the White House peace team to advise companies and investors interested in working with both Israel and the Sunni Arab world, is also seeing a massive surge of business opportunities in the region.
“What I’m trying to do now is create what I call a Middle East 2.0,” he told me in an interview for this book and ALL ISRAEL NEWS. “What I found at the beginning—long before the Abraham Accords were announced—was that there was strong interest [by Arab businessmen in doing deals with Israel], but also a slight trepidation. Less so in the security space [where] they’ve been dealing with each other for a long time. . . . However, as soon as the Abraham Accords were announced, it really did become a gold rush.”
But the Iranian nuclear threat – and Tehran’s aggressive funding and arming of terrorist organizations throughout the region – remain a significant X factor.
The gold rush could come screeching to a halt if Tehran’s violent ambitions, and those of its proxies, are not curbed.
The U.S. could also undermine investors’ confidence in the “New Middle East” by continuing to recklessly withdraw from the region, the way President Biden shocked the world by surrendering to the Taliban terrorists and foolishly pulling all U.S. forces out of Afghanistan.
What’s needed is a strong bipartisan commitment both to neutralizing the Iran threat, and to strengthening and expanding the Abraham Accords.
When Kushner spoke last Sept. 14 at an event in Washington, D.C. – launching his Abraham Accords Peace Institute and marking the one-year anniversary of peace agreements – this was the message the former senior advisor (and son-in-law) to President Donald J. Trump communicated.
I had the honor of covering that event, held at the Four Seasons Hotel, in Georgetown for ALL ISRAEL NEWS and ALL ARAB NEWS, and was struck by Kushner’s insistence that bipartisanship was the key to success in the Middle East.
“Breakthroughs like this don't just happen,” he said. “They require intense diplomacy, which involves doing a lot more listening than lecturing and by spending the work in trying to find common ground and common areas for growth and bringing people together.”
United Arab Emirates Ambassador Yousef al-Otaiba agreed and said there is “so much potential” for economic agreements to bring these nations out of an economic slump brought on by COVID.
“If you marry the Israeli and the UAE economy, and if you allow the government to create the infrastructure to let the private sector investors do what they do well, I think $1 trillion is actually achievable and is exactly what we need to get us out of the pandemic (slump).”
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.