Israel and the United Arab Emirates signed a multi-billion dollar free trade agreement on Tuesday.
The trade agreement between Israel and any Arab country is the largest ever, with a stated goal of increasing annual bilateral trade to more than $10 billion over the next five years. Israel's economy minister said that last year the trade between the two Middle Eastern countries reached $885 million.
The volume of trade between Israel and Egypt was $330 million in 2021, but it was more than double the volume of trade between Israel and the United States.
The Minister of Economy and Industry of Israel Orna Barbivai and the Minister of Economy and Industry of the United Arab Emirates, Abdulla bin Touq Al Marri, signed a deal in the United Arab Emirates.
The signing opened a new chapter in the history of the Middle East.
Jon Medved is the CEO of OurCrowd and a venture capitalist in Israel.
Trust is not something you can build in a month or two, but I think there is enormous goodwill, Medved told CNBC ahead of the deal's signing. His firm has already invested in the United Kingdom, hired employees in the Gulf and received a regulatory status from Abu Dhabi Global Market.
While I think trust is something that you can do instantly, I think the steps that are being taken are going to lead to extraordinary business opportunities.
The signing of the deal took place during renewed violence between Israelis and Palestinians.
On Monday, thousands of Israeli nationalists surrounded the Al-Aqsa compound in Jerusalem, chanting anti-Muslim slurs, with some attacking Palestinians and a few arrested for spraying a Palestinian journalist with tear gas. The demonstrators gathered to commemorate Israel's capture of Jerusalem in the Six Day War of 1967.
The foreign ministry of the United Arab Emirates condemned the storming of the Al-Aqsa compound by extremists under the protection of Israeli forces.
In Palestinian neighborhoods in the West Bank, there were attacks on homes by groups of Israelis. More than 160 Palestinians were injured, with some of them hit by live bullets after staging a counter-protest, according to the Palestinian Red Crescent.
Israeli Prime Minister Naftali Bennett vowed that anyone involved would be arrested.
The media were told they couldn't attend the signing of the trade deal on Monday, but no reason was given.
The Old City of East Jerusalem, which has been annexed by Israel since 1967, is not recognized internationally. The UN classified Israel's occupation of the Palestinian territories as a violation of international law.
The growing economic relationship between Israel and the United Arab Emirates, a Muslim country that supports Palestinian statehood, has not been affected by political differences over the Israeli-Palestinian conflict.
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