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Links between the two countries’ diamond industries have grown rapidly after the Abraham Accords
On September 17, 2020, just two days after the signing of the Abraham Accords in Washington and the establishment of diplomatic relations between Israel and the United Arab Emirates, the Israel Diamond Exchange (IDE) and the Dubai Diamond Exchange (DDE) signed a cooperation agreement.
The document commits IDE and DDE to establish offices at each other’s headquarters to facilitate bilateral trade and joint projects.
The speed with which the agreement was reached certainly speaks to the enthusiasm with which the world’s two leading diamond exchanges are entering a new era of partnership. But it also reflects another little-known fact: Long before Israel and the United Arab Emirates established official relations, business people in both countries were linked by the gemstone trade. It can even be said that the path of open economic cooperation between Israel and the UAE initiated by the Abraham Accords was paved with diamonds.
For Israel, the diamond industry is a key sector of its economy with a long history and its beginnings predate the founding of the state. For centuries, the gem trade has attracted Jewish merchants from around the world in need of a universally accepted, easily transportable currency. In the 1930s, Jewish merchants from Germany immigrated to what was then Israel, bringing with them their expertise in polishing and trading gemstones. Founded in the Tel Aviv suburb of Ramat Gan in the 1960s, the IDE now has about 3,100 members, while cut and polished diamonds account for about 23 percent of Israel’s exports.
The UAE is an emerging force in the world diamond market, but has made remarkable progress over the past two decades. Dubai’s status as a preeminent regional trade center and magnet for global luxury tourism, as well as its proximity to Asia’s gemstone production hubs, make it a natural hub for the industry. Established in 2002, DDE is part of the Dubai Multi Commodities Center (DMCC) and has over 1,100 licensed companies. It now handles about $25 billion in total trade, twice that of Israel’s IDE.
Links between the Israeli and UAE diamond industries grew rapidly after the Abraham Accords. DMCC opened a representative office within IDE in Ramat Gan in late 2020 – IDE did the same at DMCC in Dubai in February this year.
Israel Exports Rough Stones Worth $188 Million diamond Exports to the UAE in 2021 are set to grow after the two countries signed a free trade agreement in June, removing tariffs on 95% of products, including cutting duties on diamonds and gemstones from 5% to zero.
The role played by the diamond trade in foreshadowing relations between Israel and the UAE may be replicated elsewhere. Although Israel and Qatar still do not have formal diplomatic relations, the two countries have reportedly reached an agreement to allow Israeli diamond traders to operate in a new gem and gold free trade zone in Doha, under the Dubai DMC​ ​C model built.
So the road paved with diamonds sparkles abraham agreementIt could end up stretching even further in the Gulf.
Calev Ben-David is the anchor of “The Rundown,” the i24NEWS evening news show
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