Trade between Israel and the seven Arab countries that have normalised relations with the Jewish state broke records in 2023, exceeding $4 billion, up 16 percent from 2022, according to a report.
Bilateral trade among the nations decreased by only 4 percent following the outbreak of the war in Gaza in October, from $937 million to $903 million, according to the annual report of the Abraham Accords Peace Institute (AAPI) published this week.
This is in stark contrast to Israel’s overall trade with the outside world, which declined 18 percent.
AAPI’s report relies on data from the Israel Central Bureau of Statistics (CBS).
The Abraham Accords were initiated in 2020 by the US. Under them, Israel established diplomatic relations with the UAE, Bahrain, Sudan, Kosovo, Mauritania and Morocco.
These Arab countries joined Egypt and Jordan in full diplomatic ties with the Jewish state. The AAPI report did not include Mauritania in its data.
The report analysed the progress of ties between the countries in the third full year since the signing of the agreements. It said the true value of Abraham Accords trade was likely to be more than $10 billion when unaccounted transactions in natural gas, water and defence were included.
Exports of natural gas and water from Israel to Egypt and Jordan are estimated to be valued at more than $2 billion.
srael’s defence ministry said that Abraham Accord countries received 24 percent of its $13 billion defence exports in 2022.
Israel-UAE trade drops by 14%
Israel and the UAE account for three-quarters of Israel’s trade with Abraham Accords countries, dominated by tourism, technology, agriculture and diamonds.
The report showed a 14 percent drop in Israel-UAE trade in the last quarter of 2023 following the conflict.
Before this, trade between the two countries, not including significant sectors such as cyber, software, services and defence, had surged to nearly $3 billion, a 17 percent increase from the previous year.
In the fourth quarter, Israel’s trade with Egypt jumped 168 percent year on year, from $71 million to $191 million, the report said.
Trade with Morocco increased 8 percent from $24 million to $26 million.
Meanwhile, trade with Jordan fell 8 percent in the first nine months of the year compared with 2022 and then dropped 42 percent in the last quarter.
However, the report attributed the decline mainly to 2022’s spike in Jordanian agricultural exports.
The report suggests that developing the Gulf-Mediterranean overland trade route and expanding natural gas cooperation may boost regional economic ties, particularly in developing Eastern Mediterranean gas resources as an alternative to Russian gas.
Robert Greenway, a board member and former president and executive director at the Abraham Accords Peace Institute, said in a foreword to the report that the Abraham Accords have proven to be “highly consequential for US interests in the Middle East”.
The report described diplomatic ties as remaining “stable” after the October 7 attacks but admitted that the war had a strong negative impact on regional public opinion towards Israel.
AGBI reported last month that Kuwait’s Alshaya Group, one of the Gulf’s largest franchise owners, was cutting jobs at its Starbucks outlets. Stories have circulated about Starbucks’ perceived pro-Israel stance but the company has denied this is the case, saying that it “stands for humanity”.
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