DUBAI -- Israel signed a free trade deal with the United Arab Emirates (UAE) on Tuesday (May 31), its first with an Arab country, building on their US-brokered normalisation of diplomatic relations in 2020.
Israel's ambassador to the UAE, Amir Hayek, tweeted "mabruk" -- Arabic for "congratulations" -- with a photo of Emirati and Israeli officials at a signing ceremony in Dubai.
The Emirati envoy to Israel, Mohamed Al Khaja, hailed as an "unprecedented achievement" the deal, which, according to the Israeli side, scraps customs duties on 96% of all products traded.
"Businesses in both countries will benefit from faster access to markets and lower tariffs as our nations work together to increase trade, create jobs, promote new skills and deepen co-operation," Al Khaja tweeted.
The 2020 deal was part of the US-brokered Abraham Accords that also saw Israel establish diplomatic ties with Bahrain and Morocco.
Two-way trade between Israel and the UAE last year totalled some $900 million dollars, according to Israeli figures.
UAE-Israel Business Council President Dorian Barak predicted that trade would soon multiply between the two economies.
"UAE-Israel trade will exceed $2 billion in 2022, rising to around $5 billion in five years, bolstered by collaboration in renewables, consumer goods, tourism and the life sciences sectors," he said in a statement.
"Dubai is fast becoming a hub for Israeli companies that look to South Asia, the Middle East and the Far East as markets for their goods and services."
Almost 1,000 Israeli companies will be working in and through the UAE by year's end, he said.
The UAE was the first Gulf country to normalise ties with Israel and only the third Arab nation to do so after Egypt and Jordan.
Talks for a free trade agreement began in November and concluded after four rounds of negotiations.
The latest was held in March in Egypt between Israeli Prime Minister Naftali Bennett and Sheikh Mohammed bin Zayed Al Nahyan, UAE's long-time de facto ruler who became president in May after the death of his half-brother Sheikh Khalifa.
Israel had in March hosted a meeting of the top diplomats from the United States, UAE, Bahrain and Morocco.
Talks on reviving the 2015 Iran nuclear deal were high on the agenda at the gathering. The efforts to revive the pact have raised concern among US-allied Arab states and Israel, which view Iran as a menace.
In February, Israel also signed a defence agreement with Bahrain, its first such deal with a Gulf country since establishing diplomatic ties with Manama and Abu Dhabi.
"Only one year following the signing of the accords, we have achieved an important defence agreement, which will contribute to the security of both countries and the stability of the region," Israeli Defence Minister Benny Gantz said in a statement.
Tel Aviv has called for deeper co-operation with Gulf partners to confront "maritime and aerial threats", Gantz said as he toured the US 5th Fleet headquarters in Bahrain.