Israel’s exports to Gulf states worth almost $1 billion, study suggests
AP Photo/Kamran Jebreili-File
Israel’s exports to Gulf Arab states were worth some one billion dollars in 2016, a new analysis of trade data suggests, despite their refusal to recognize Israel or have diplomatic relations with it.
Israel’s publicly available foreign trade data does not show any direct trade in recent years with countries such as Saudi Arabia and the United Arab Emirates, but the Tony Blair Institute for Global Change said Tuesday its analysis of goods flows between third countries suggest the true amount is “close to” USD$1 billion.
Its estimate suggests Israeli exports to the Gulf Cooperation Council (GCC) countries outstripped those to allies and giant economies such as Russia and Japan in 2016, the most recent year for which annualized Israeli trade data is available.
The GCC is comprised of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates.
Each are wealthy monarchies with rapacious consumer markets and an appetite for the kinds of advanced technology Israeli firms offer. The study said the one billion figure is only a tiny fraction of the trade’s potential.
“Given the size of these (GCC) markets, even if Israel’s potential share of them is conservatively estimated at just 2-3 percent of their total imports of goods and services under normal trading conditions, that would amount to $15-25 billion,” the report’s authors wrote of a situation in which the trade was conducted openly.
No GCC country has open ties with Israel, although Israeli officials have strongly hinted at covert relations with Saudi Arabia, Bahrain and the United Arab Emirates in the realm of security and intelligence, as all four countries seek to join forces against Iran.
It has been well known that trade flows exist between Israel and countries that do not recognize it, but few have ventured to estimate its worth.
The institute, led by former British Prime Minister Tony Blair, said that the true value of the trade is hidden in export statistics of Israel’s trade to various third countries in the Middle East, Europe and North America.
It has been previously reported that goods shipped to third countries are then resold to the Gulf in order to keep the trade under wraps, or that Israeli and Gulf companies forge commercial agreements there in order to disguise the deals.
Despite the convoluted processes involved, the institute estimates that the level of trade is greater than Israel has with Egypt and Jordan combined, despite having peace treaties with both.
In 2012 and 2013, Israel’s publicly available foreign trade data showed modest direct imports and exports with each GCC country, according to data reviewed by i24NEWS.
In most cases the amounts numbered in just the hundreds of thousands of dollars in value, although sales of diamonds to the United Arab Emirates swelled the value of exports to that country to $20.8 million.
However since then Israeli export and import figures do not show any trade with the six Arab Gulf states.
Earlier this year Saudi Arabia and Oman gave a rare public indication of readiness to deal with Israel in the economic sphere by allowing Air India to use their airspace for its flights to Tel Aviv, although Israeli carriers are still forced to circumvent the Arabian peninsula on flights to India and Thailand.
Several American Jewish leaders who have probed the issue of Israel in visits to Gulf countries have indicated that the Palestinian issue will continue to keep trade or political ties from fulfilling their potential.
In June an official from Bahrain told i24NEWS that the kingdom would be the first Gulf state to formalize ties with Israel.
According to research by Citizen Lab, a Canadian non-profit, Israeli-origin spyware has almost certainly been sold to authorities in Bahrain and the United Arab Emirates.
The paper also highlighted that Israel’s trade with Egypt and Jordan are under-performing relative to the size of all three economies, relatively cheap transport costs and the formal diplomatic relations that exist.
It put the “untapped potential” of Israeli exports to and through Egypt, Jordan and the Palestinian Authority at $30-35 billion, around one third of Israel’s total annual exports.
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