‘Small countries punching above their weight’. How diplomacy is ushering in a new era for Middle East tech

The Abraham Accords, a series of normalisation deals signed last year between Israel and Bahrain, Morocco, Sudan and the United Arab Emirates (UAE), offer the chance to galvanise the technology sector across the region.

The deals signed last year established diplomatic relations between the countries and also opened the way for more business opportunities between the long-estranged states.

The Accords were “a historical and timely breakthrough, and a turning point for the Middle East region,” says Abdulla Al Hamed, managing partner at digital transformation and consultancy company INTERMID and chairman of the Bahrain Internet Society. “For future generations to prosper, we must find ways to address the common issues the world is facing right now, and the Middle East is no exception,” he says.

Shared goals

Despite their historic differences, there are strong similarities in the role that tech and innovation plays in driving the economies of countries such as Israel, Bahrain and the UAE.

“The Gulf and Israel are really well placed to take advantage and leverage each other because they’re both high-tech, very modern economies,” says Seth Frantzman a Middle East security analyst and founder of the new website Israel-Gulf Report. “They are both tech hubs.” 

Carrington Malin, a Dubai-based entrepreneur, marketer, and writer focused on emerging technologies, agrees, noting the symbiotic nature of this relationship.

These new arrangements offer technology sectors in both countries enormous opportunities, Malin says, pointing to UAE’s desire to encourage home-grown innovation and attract global tech talent, as well as opportunities to “draw on some of the resources and expertise that has helped Israel to scale its startup ecosystem.”

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Meanwhile, for Israeli companies, there are opportunities to expand into new markets – essential for a country with a population of just nine million – as well as attract fresh investment.

Early evidence suggests an element of pent-up demand for this thawing of relationships.

“So far, the engagement of Israeli tech firms with the UAE has been enthusiastic, to say the least,” Malin says.

“There was this outpouring, almost like a love affair on both sides,” Frantzman concurs.

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This interest is not just related to the business community. Until the latest round of lockdowns curtailed air travel, 130,000 Israeli tourists visited UAE after travel restrictions between the nations were lifted. 

Meanwhile, in December, thousands of Israelis flew to Dubai to meet UAE companies at GITEX, the annual conference that serves as the Arab world’s largest IT industry gathering. As part of the event, GITEX 2020 hosted the inaugural UAE-Israel Future Digital Economy Summit, a day of discussions around topics such as 5G, fintech, mobility, cybersecurity and AI, which offered insights into potential areas of collaboration between the two nations.

“It’s going to be so much easier to have a business conversation once you’ve had that kind of personal relationship with a place by virtue of just being able to freely visit it,” comments Gili Cegla, a serial entrepreneur, startup investor and co-founder of Israel’s Geekcon, a summer camp for “pointless tech.”

“You’re suddenly able to visit places that you have hadn’t before. It’s a way to change perception and awareness,” he adds.

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Early developments

Once the Accords where in place, there was a rapid start to business relationships.

“Some Israeli and UAE businesses began forming collaborations almost immediately after the two countries opened up relations,” explains Nir Kouris, the Tel Aviv-based founder of Fintech Nation Global Summit and the UAE-Israel Fintech Week.

In September, a month after formalisation of relationships between their countries, APEX Nation Investment – a leading investment firm in the UAE – and Israel’s Sheba Medical Center revealed plans for a joint innovation hub, based in the Gulf and using Sheba’s big data platform.

The move followed an earlier partnership, announced once the diplomatic deal had been inked, between APEX and the Israeli Tera Group, focused on COVID-19-related R&D.

Moving forward

COVID’s winter resurgence has inevitably slowed down these developments, meaning – as Frantzman put it – “there aren’t as many physical public handshakes”. However, conversations are continuing to happen in the background or via online conferences.

One of the first of these, Fintech Week, took place (from 29 November to 4 December) as a virtual event backed by global players like Facebook and Microsoft for Startups, as well as regional partners, such as the Israeli Ministry of Foreign Affairs.

“We were able to expand Fintech Week to cover both Israel and the UAE with more than 1,000 participants, just a few weeks after the Accords were signed,” Kouris tells ZDNet, with events like a recent fintech hackathon representing an early opportunity for further cross-border engagement.

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For Cegla, these initial moves are a taste of what’s to come. “I see immediate actions and immediate growth in cybersecurity, health and agtech,” he says, with the UAE being a “destination buyer” for these products and services. 

It’s a view that chimes with Al Hamed in Bahrain, who sees particular opportunities in sectors “such as infrastructure investments, commercial, space programmes, clean energy, education and medicine.”

He also identifies digital art, gaming, robotics, cybersecurity, cloud computing and AI as sources for closer ties and cooperation.

The inclusion of space technology on this list may raise a few eyebrows, but as Frantzman reminds us, both UAE and Israel have space programmes, despite the population of each country being under 10 million. “These are small countries that are punching way above their weight in different ways,” he says.

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