With the advent of diplomatic relations between the two countries under pressureEconomic relations between the UAE and Israel took a major step forward on Sunday, with the signing of the final and most important component of a free trade agreement.
The tariff agreement was signed in Jerusalem by Foreign Minister Eli Cohen and UAE Ambassador Mohammad Hajja in the presence of Prime Minister Benjamin Netanyahu.
this Israel-UAE Comprehensive Economic Partnership Agreement It was signed in Dubai last May, but it will not take effect until Sunday when the two countries sign a customs agreement.
“This puts the meat on the bone,” an Emirati diplomat told The Times of Israel.
The customs agreement took months to reach as both sides had to scrutinize each product and decide which ones to cover.
According to the UAE, the agreement reduces or eliminates tariffs on more than 96 percent of tariff lines and 99 percent of the trade value between the two countries.
Israel’s tax and customs authorities are among the agencies taking part in the talks.
They concluded weeks ago, but the signing ceremony waited until Netanyahu, Cohen and Kaja were all in the country at the same time.
The agreement will take effect on April 1.
At the signing ceremony, Netanyahu said the agreement would “reduce tariffs, lower the cost of living and give a shot in the arm to business activity between Israel and the UAE”.
“I believe we will continue to expand our circle of peace with Israel and with other countries in the region,” he added.
Free trade agreements cover aspects such as regulation, customs, services, government procurement, e-commerce and intellectual property protection.
Under the agreement, about 96 percent of products traded between the two countries, including food, agricultural products, cosmetics, medical equipment and pharmaceuticals, will be exempt from tariffs. Some products will be exempted immediately, while others will be exempted gradually.
The UAE and Israel signed a normalization agreement in 2020 as part of the US-backed Abraham Accords.