On August 13, 2020, Israel and two Arab Gulf states, the United Arab Emirates and Bahrain, have formally and publicly established diplomatic relations, named “The Abraham Accords”. But what exactly are the accords about? And how impact does it have on the local startup ecosystem?
Designed to establish peace, diplomatic and friendly relations for the benefit of all States and peoples in the region, this Treaty unlocks a vast potential for the three countries and for the Middle East. Here is what has been agreed upon:
Establishment of Peace, Diplomatic Relations and Normalization between the United Arab Emirates and the State of Israel.
The Parties shall recognize and respect each other’s sovereignty and right to live in peace and security, develop friendly relations of cooperation between them and their peoples, and settle all disputes between them by peaceful means.
The Parties shall exchange resident ambassadors as soon as practicable after the signing of this Treaty, and shall conduct diplomatic and consular relations in accordance with the applicable rules of international law.
For the purpose of advancing the cause of peace, stability and prosperity throughout the Middle East, the Parties shall conclude bilateral agreements in the following spheres at the earliest practicable date, as well as in other spheres of mutual interest as may be agreed: Finance and Investment, Civil Aviation, Visas and Consular Services, Innovation, Trade and Economic Relations
The Accords also talk about the importance of innovation, encouraging parties to expand their cooperation in innovation, trade and economic relations, so that the dividends of peace are felt across their societies. The Parties also reaffirm their commitment to protecting investors, consumers, market integrity and financial stability, as well as cooperating to expeditiously deepen and broaden bilateral investment relations.
Notably, one of the biggest impacts from this agreement is the ability for goods, people - and importantly, investments - to move more freely throughout the region. The Middle East has had the lowest rate of intra-regional trade in the world, with just 5% of exports from Middle East and North Africa (MENA) countries going to their regional neighbors. However, “normalized relations”—which the accord establishes—mark a huge step forward: the creation of embassies, commercial air routes, tourism, security and intelligence ties, and as a result, the region gets access to Israel’s high-technology products and marketplace.
What does this mean for the startup ecosystem?
The Abraham Accords largely facilitate the exchange of ideas and investments across the region. For Israel startups seeking funding locally, the agreement opens doors to investors, in particular, from UAE.
In order to support the ecosystem and relationship-building, The Startup Club invites you to learn about getting started with UAE investors. The Arab-Israel Startup Festival on December 16th will host a panel of investors and experts, who will discuss the problems startups are facing connecting, contacting, and gaining trust from the UAE stakeholders.
Learn more about the opportunity via the link.