A cooperation agreement aimed at improving trade relations between the two countries was signed by the UAE and Israeli export credit agencies.
Etihad Credit Insurance (ECI) said in a statement that it will collaborate with the Israel Foreign Trade Risks Insurance Corporation (Ashr’a) to facilitate exports, trade and investment between the two markets.
“This first-of-its-kind agreement between the export credit agencies of UAE and Israel is a result of the giant leap for sustainable peace” through the signing of the Abraham Accords, Massimo Falcioni, chief executive of Etihad Credit Insurance, said.
“With state guarantees from both countries, this deal will encourage exports and investments, help minimize political and commercial risks, and raise export financing for the mid- and long-term,” Nissim Ben Eli, chief executive of Ashr’a, added.
The UAE and Israel normalized relations after signing the Abraham Accords in September. A number of other pacts have been signed since then to encourage collaboration in sectors ranging from aviation to finance. According to the ECI, annual trade exchanges between the UAE and Israel are expected to hit $4 billion a year.
The agreement between export credit agencies is expected to ease exporters’ access to export credit facilities” and reduce non-payment-related risks. It will cover businesses in key sectors including agriculture, water treatment, renewable energy, medical and health care, aluminum, steel, cables, petrochemicals and technology, in both markets.
“The historic agreement is now ushering a fresh start of economic relations,” Mr Falcioni said. “ECI is confident that this alliance will be a game changer in terms of generating an efficient exchange of expertise that would bolster the trade and export communities of our respective countries.”
The two organizations will also discuss joint opportunities for exporters to benefit from co-insurance services and promote market access for SMEs (Small and Medium Enterprises). They will also share best practice in areas like risk management and underwriting as well as carrying out country risk assessments.
“With accessibility to a vast array of export credit, financing and investment insurance products, the exporting communities in both countries stand to benefit from this strategic deal,” the statement said.
ECI, founded in 2018, offers export guarantees and trade insurance on behalf of the UAE government to mitigate the political and commercial risks of international trade. The entity has partnerships with local and international banks that can offer loans to UAE companies to fund exports to overseas buyers, with ECI providing insurance.