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UAE-Israeli businesses are all set to make that big push once accord is signed
But the timing on the direct flights will, of course, depend on technicalities around COVID-1 “Theoretically, the [air travel] pact could be ready for direct flights from mid-October/early November onwards,” said Linus Benjamin Bauer, Managing Director of Bauer Aviation.
“Two weeks ago, Saudi Arabia announced that it would allow any flights going to and from the UAE to fly over its territory. Such historic developments would speed up the entire process to launch direct flights between the UAE and Israel.”
But some UAE companies are not waiting for the flights to commence. Abu Dhabi based Group42, which is into cloud computing services, last week became the first to announce that it has set up an office in Israel. It also didn’t waste time tying up alliances with Israeli partners.
“Israel is today home to more than 6,000 high-tech companies and startups, has the highest concentration of hi-tech companies in the world (apart from Silicon Valley), and leads the world in the number of scientists and technicians in the workforce,” Group42 said in the statement announcing the office set up.
Emirates NBD late on Monday confirmed an MoU with Bank Hapoalim, one of Israel’s largest banks. It should be the first of many more in the financial services industry.
Leveraging traditional strengths
While alliances in financial technology or agri-tech could be seen as natural fits, heads of UAE businesses representing the ‘Old Economy’ are not losing sight of what it could mean once this trade “route” opens up.
“In the construction and building materials supply sectors, the UAE businesses are more than ready for a new market such as Israel,” said Rizwan Sajan, Chairman of Danube Group. “This peace deal will help us to build homes in West Bank and Gaza.
“However, companies will have to see the tax regulations before entering the Israeli market.”
Not that all of the investment action need to be in one direction only – “UAE businesses also could benefit from Israeli investment, especially in real estate as the prices of real estate is four- to five times higher than in the UAE,” the Danube chief added.
Ofir Bar-Noy is part of the newly created Emirates Israel Investment Group. According to him, there are three key sectors where the new partners could generate maximum opportunities:
* Cyber security: Israel is home to leading surveillance companies and UAE is a strong base for cyber security, technology and surveillance;
* Energy: In the recent past, Israel has become a regional renewable energy leader and has started to develop natural gas. The country has also heavily invested in green energy solutions. As of last year, the country had more than 1.4 gigawatts of solar power capacity, just behind the UAE and Egypt.
* Agriculture: Israel is a world leader in agriculture featuring less use of water and despite high heat. Israel has strong research that has been studied and developed over the past 50 years and will help in promoting desert agricultural projects in the UAE.
At some point in the near future, the hospitality sector would gain from the launch of direct flights as well as the transit points the Dubai and Abu Dhabi airports serve as. Hotel industry sources say it’s only a question of when such a boost will be felt – a destination like Dubai would score given its short-haul status.
“Being two major economic powerhouses in Middle East, there can be a boost in infrastructure, technology, environmental sustainability, etc.,” said Dr. Azad Moopen, Chairman and Managing Director, Aster DM Healthcare.
“This will help to build capabilities across both countries in sectors like healthcare, biotech, digital technology, education, energy, etc. As an healthcare organization born and brought up in UAE, we are looking for exciting partnerships with counterparts in Israel in various areas.”
At a time when the Gulf and Middle East economies could do with all the boost they can get – after the pandemic strike – the normalization of relations between UAE and Israel would count as one massive plus.
UAE manufacturers and traders want to get ahead in the queue to cash in. “As a tyre and battery manufacturing company, we are looking forward to exporting to Israel. In fact we are already talking to companies in the country for this,” said Surender Singh Kandhari, Chairman of Al Dobowi Group and Eternity Technologies. “We have manufacturing plants in the UAE that have not been able to market our products to Israel.
“With the accord being signed that market has opened up now. The Israel market is massive for industrial and automotive batteries.”
Makings of a win-win
Bharat Bhatia, CEO of Conares, the steel mills operator, says it is about realizing opportunities that will be created from access to a brand new market.
“The UAE business sector needs more innovative ideas to enhance manufacturing and FMGC sectors,” he said. “Specifically, on the building materials and infrastructure development sector, there are possibilities for UAE suppliers to reach out to Israeli market.
“The UAE suppliers can look for opportunities to export steel manufactured in the UAE. We will explore the options of exporting steel pipes and tubes and pre-painted coils as well as debars to Israel from the UAE. This is because the UAE is strategically linked with proximity to the Arabian Ocean while Israel is strategically linked with Mediterranean Sea.”