Peace deal at the White House

Ahmed Mostafa , Tuesday 15 Sep 2020

The United Arab Emirates and Bahrain signed normalisation agreements with Israel during a ceremony at the White House this week

Peace deal at the White House
(photo: AFP)

In a grand ceremony on the south lawn of the White House in Washington DC, US President Donald Trump presided over the signing of peace deals between Israel and two Gulf countries, the United Arab Emirates (UAE) and Bahrain, this week.

Some Arab diplomats were among the around 200 people in the audience, to which representatives of the US Democratic Party were also invited. Israel was represented by its Prime Minister Benjamin Netanyahu, while the UAE and Bahrain were represented by their foreign ministers, sheikh Abdullah Bin Zayed Al-Nahyan and Abdullatif Al-Zayani, respectively.

A common document known as the Abraham Accords was signed by the four parties, while Israel signed separate agreements with the two Gulf countries. The UAE and Bahrain are the third and fourth Arab countries to normalise relations with Israel since the Camp David Accords with Egypt in 1979 and the Wadi Araba Agreement with Jordan in 1994.

Trump’s critics downplayed the event as an election campaign stunt coming just 48 days before the US presidential elections, but the agreements are legally binding, and both Gulf countries are now only waiting for their ratification next month before embarking on an era of cooperation with Israel.

Netanyahu’s adversaries in Israel and beyond said the agreements were intended as distractions from the problems the prime minister is facing at home, yet nobody in Israel would criticise a peace deal with an Arab country as the population is keen on normalising relations with the Arab world.

In the Gulf, the story is a bit different, even as people anticipate the benefits of peace deals with Israel. The mood is less muted than it was last year when Trump and his adviser and son-in-law Jared Kushner announced their so-called “Peace for Prosperity” deal to settle the Palestinian issue.

Emirati political commentator Rashed Murooshid told the Al-Ahram Weekly that the normalisation of relations between Israel and the UAE and Bahrain would open up new business opportunities, particularly in technology, investment and tourism. “There is no doubt that Israel has also accumulated experience in fighting terrorism that would be of benefit to others, I mean its technological advances in this regard,” he said.

Regarding any possible challenges to a warm peace between Israel and the Gulf countries, Murooshid said that “we look to the future and the benefits of cooperation for all the peoples in the region, not burdened by the bitterness of the past. Yet, that doesn’t mean giving up on the basic principles we believe in, on top of them the fair and just settlement of the Palestinian issue.”

In the few weeks since the announcement of the deal with the UAE, various Israeli trade delegations have visited Abu Dhabi and several putative deals have been announced. In the few days between Manama announcing the deal and the White House ceremony, contacts between Bahraini ministers and Israeli officials were made to discuss aspects of future cooperation.

The UK newspaper the Financial Times quoted Israeli Minister for Regional Cooperation Ofir Akunis as saying that Israel expected to seal deals worth about $500 million after the historic agreements to normalise ties with the UAE and Bahrain come into force.

“The Jewish state will offer its expertise in water desalination and agricultural technology as the most promising sectors for cooperation with its new business partners in the Gulf,” he said, but investments would vary from technology and tourism to culture and transportation.

“The main idea here is peace to prosperity… We want bilateral economic relationships with the UAE and Bahrain to build a new Middle East,” Akunis said.

However, there could be nuances to these huge expected deals and business partnerships, editorial director of the Middle East Economic Digest (MEED) Richard Thompson said in a note for GlobalData.

“Companies in the Gulf must assess any potential legal, commercial, reputational and security risks that might result from their doing business with Israel,” he said.

“It is now legal for companies in the UAE and Bahrain to do business with Israel, but it is currently still illegal to do business with Israel in every other Arab market except Jordan and Egypt. This includes Saudi Arabia, Kuwait, Oman, Qatar, Iraq, Lebanon, Morocco, Algeria and Tunisia. It is also illegal for people or companies from those countries to have direct business dealings with Israelis.”

 “For many businesses in the region, Saudi Arabia’s position will be a significant factor in how they respond to the changes. Things have changed quickly and unexpectedly, and in the current climate they could change again. Companies should tread carefully.”

But it is almost certain that Saudi Arabia agreed to the peace deals between Israel and the two Gulf countries, even though Riyadh said it was too early to sign a deal with Israel itself.

Concerning the challenges that those doing business with Israel might face, Saudi commentator Abdel-Aziz Alkhames told the Weekly that many of the regulations restricting dealings with companies that deal with Israel had been long frozen by almost all the countries in the region.

“Since Egypt and Jordan signed peace agreements with Israel, many countries including Saudi Arabia have frozen their boycott rules. They have even relaxed regulations on certificate-of-origin issues so as not to punish Egyptian or Jordanian businesses that have dealings with Israeli companies,” Alkhames said.

He expected little to be gained by Bahrain from the agreement with Israel, though “probably it would benefit from cooperation in tourism and in some aspects of financial services,” he said. “Israel aims to be a financial hub in the region, and it wants Tel Aviv to be more than the Beirut of the 1950s for the Gulf region,” when the Lebanese capital played a similar role.

The main area of cooperation that would be of benefit to the UAE, Bahrain and other Gulf countries that might also sign normalisation deals with Israel is likely in technology and its industrial applications, according to Alkhames.

“I think the country that is most affected by the peace deals between the Gulf countries and Israel is Turkey. Almost all the advanced components of Turkish exports to the Gulf are in fact Israeli. Importing directly from Israel will deprive Turkey of lucrative benefits. Jordan might also lose some of the benefits it gets from exporting products to the Gulf countries that are produced by Israeli businesses investing in Jordan,” he said.

The talk in the region now is about which country could be next in signing an agreement with Israel. It has been widely anticipated that Morocco could soon announce such a deal, but official statements from Rabat have cooled the anticipation.

Trump spoke to the sultan of Oman by telephone last week, and since then expectations have been high that Muscat could be the next Arab capital to announce the normalisation of relations with Israel.

Muscat, Doha and Rabat were the three Arab capitals that established representative offices for Israel after the Oslo Accords between the Israelis and Palestinians in the 1990s. For this reason, it is likely that one or all of them will be next.

*A version of this article appears in print in the 17 September, 2020 edition of Al-Ahram Weekly

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