March 2023 witnessed several significant developments for the Abraham Accords in the economic, innovation, and diplomatic spheres.
Israel and the UAE signed the customs agreement of the historic Comprehensive Economic Partnership Agreement (CEPA), bringing into effect a free trade deal affecting 96% of goods traded between the two countries. The agreement promises to further accelerate an already blossoming Israeli-Emirati trade relationship, demonstrating the economic potential of the Abraham Accords.
Start-Up Nation Central hosted a first-of-its-kind “Connect2Innovate” conference in Manama, Bahrain, bringing together over 500 Bahraini, Emirati, and Israeli business leaders. Later in the month, the Jerusalem Center for Public Affairs convened a first-ever Arab-Africa conference in Jerusalem, assembling leaders from roughly 20 African and Middle Eastern countries—some of which have not normalized relations with Israel—for discussions on the Abraham Accords, food and water security, counter-terrorism and more. Beyond the conferences, several agreements were signed between Accords member country businesses, and multiple high-level government visits took place. Hungary also launched its parliamentary Abraham Accords Support Group of Friends.
This month, we highlight an op-ed from Executive Director Rob Greenway and Director for Israel Asher Fredman on how the Abraham Accords can be leveraged to help solve Europe’s energy crisis.
Despite progress in reducing Europe’s dependency on Russian gas, the EU’s energy outlook remains volatile. An increase in Chinese liquefied natural gas (LNG) purchases, along with periods of harsh weather, could set off repeated energy crises in the coming years. To address this critical challenge, Europe should look to the Eastern Mediterranean for energy solutions, leveraging the new opportunities for cooperation made possible by the Abraham Accords.
Such cooperation to address Europe’s energy needs, spanning the Mediterranean and Middle East, would have the added benefit of promoting stability and prosperity across the region. It is not surprising that this was one of the main topics of discussion during Israeli PM Netanyahu’s March meeting with Italian Premier Meloni.
According to the International Energy Agency, Europe may face a gas shortfall of 57 billion cubic meters (bcm) in 2023. While part of this shortfall may be made up by current EU initiatives, it is likely that costly shortages will recur. Already, dozens of European plants in energy-intensive industries such as steel, aluminum, fertilizers and power have been forced to shut down.
To date, Israel has developed approximately 1,000 bcm of natural gas, and it may have further reserves of 1,000-2,000 bcm. According to leading natural gas expert, Gina Cohen, “Israel could supply 15 bcm a year to Europe, for a period of 15-20 years from 2025.”
Cyprus, Israel’s Mediterranean neighbor, has estimated gas reserves of 200-400 bcm. Combining Israeli and Cypriot reserves, and potentially in the future, gas from additional regional players such as northern Iraq and Libya, could play a substantial role in filling the gap left by Russian gas.
Yet despite the significant gas reserves in the region, utilizing them to provide solutions for Europe will require overcoming numerous obstacles.
Today, the primary means to deliver gas to Europe from Israel is via Egypt’s liquefaction facilities, from where the LNG is shipped to Europe. However, the existing Israel-Egypt pipelines suffer from bottlenecks and capacity limits.
One potential solution is to build a new pipeline directly from Israel’s gas fields to Egypt’s LNG facilities. While this option has the benefit of strengthening Israeli-Egyptian cooperation, it presents a serious risk that Egypt will divert gas for its domestic needs, rather than send it to Europe.
In our view, the two most promising mid-term options for regional solutions to Europe’s gas crisis are the EastMed Pipeline project, or the construction of a Floating Liquefied Natural Gas (FLNG) facility off of Israel’s coast. Both of these options have become more realistic in the wake of the Abraham Accords.
The proposed 1,900 km EastMed Pipeline would link Israel to mainland Greece via Cyprus and Crete. The transportation capacity of the pipeline is expected to be 10 bcm per year, potentially expandable to 20 bcm per year. The estimated cost is $6-7 billion, with an estimated construction time of 4-5 years.
At the beginning of 2022, the EU reconfirmed the status of EastMed as a ‘Project of Common Interest’. Yet a final decision to proceed with such an ambitious pipeline will require identifying strategic European offtakers. It will also require substantial investment and expertise. Israel’s new GCC partners could play a key role in the successful execution of such a complex project, which could complement Emirati sovereign wealth fund Mubadala’s purchase of a 22% stake in Israel’s Tamar gas field.
The EastMed Pipeline has the added benefit of potentially being designed to carry hydrogen or other low-carbon fuels in the future, thereby supporting the EU’s energy transition. The second promising option is stationing a FLNG facility off the Israeli coast, from where Israeli and Cypriot gas could be shipped to Europe. According to Cohen, the cost of such a facility would be slightly over $5 billion for a FLNG that could liquefy up to 5 bcm per year. The main drawback of this option is the high up-front cost in relation to the amount of gas produced. Here too, investment or partnership between Israel and other Abraham Accords countries could make the project commercially viable.
Looking towards the future, a partnership between the EU and Abraham Accords countries could accelerate the sustainable energy transition, particularly with regards to green hydrogen.
According to PwC, “Although many countries have ambitious plans for green hydrogen, the GCC states also have unique advantages that could allow them to lead the hydrogen economy.” At the same time, Israel is a recognized leader in clean energy technologies. Startup Genome’s 2022 ‘Global Startup Ecosystem Report: Cleantech Edition’ ranked Tel Aviv as the number 2 cleantech ecosystem globally. Europe, Israel and the Gulf can combine their relative strengths to scale innovative clean energy production, storage and transportation.
Given the urgent need to advance European energy security, it is vital that the EU work with the countries of the Eastern Mediterranean and Abraham Accords to advance strategic solutions, such as those proposed here. Frameworks such as the East Mediterranean Gas Forum and Negev Forum should be utilized to facilitate cooperation among a broad range of public and private stakeholders. Israel must develop a comprehensive energy strategy, which includes overcoming regulatory hurdles. The possibility of resurrecting the UAE-Israel Med-Red agreement to transport Emirati oil to Europe could also be examined.
Together, Europe and the countries of the region can advance energy independence from Russia, while building a more stable and sustainable future for the Mediterranean and the Middle East.
AAPI President and Executive Director Robert Greenway testified on the Abraham Accords to the House Foreign Affairs Subcommittee on Middle East, North Africa, and Central Asia.
AAPI Deputy Director for Israel David Aaronson testified (English, Hebrew) about trade between Israel, Egypt, and Abraham Accords countries via the Nitzana Border Crossing to the Knesset Negev and Galilee Committee.
Trade between Israel and the United Arab Emirates reached $280.1 million in February 2023, constituting a 67.52% increase in trade from February 2022. For the first 2 months of 2023, bilateral trade was $540.6 million, constituting a 76.61% increase in trade from the first 2 months of 2022.
Trade between Israel and Bahrain reached $1.8 million in February 2023, constituting a 260% increase in trade from February 2022. For the first 2 months of 2023, bilateral trade was $3 million, constituting a 233.33% increase in trade from the first 2 months of 2022.
Trade between Israel and Morocco reached $3.6 million in February 2023, constituting an 80% increase in trade from February 2022. For the first 2 months of 2023, bilateral trade was $17.4 million, constituting a 346.15% increase in trade from the first 2 months of 2022.
Trade between Israel and Egypt reached $22.2 million in February 2023, constituting a 3.48% decrease in trade from February 2022. For the first 2 months of 2023, bilateral trade was $71.3 million, constituting a 56.7% increase in trade from the first 2 months of 2022.
Trade between Israel and Jordan reached $49.4 million in February 2023, constituting a 51.53% increase in trade from February 2022. For the first 2 months of 2023, bilateral trade was $91.7 million, constituting a 20.5% increase in trade from the first 2 months of 2022.
Below you can find a timeline of notable Abraham Accords-related events that occurred in the month of March 2023:
February 27 – March 5: Israeli NGO Sharaka hosted an Arab and Muslim delegation from Algeria, Bahrain, Egypt, France, Iraq, Israel, Morocco, Turkey, and the UK to discuss tolerance, the Abraham Accords, and education about the Holocaust.
March 1: MPs in the Hungarian National Assembly officially announced the launch of their Abraham Accords Support Group of Friends.
March 1: The Chairman of the Defense, Interior and Foreign Affairs Committee of the UAE Federal National Council (FNC), Dr. Ali Rashid Al Nuaimi, met with Amir Hayek, Israeli Ambassador to the UAE.
March 3: Israeli irrigation equipment manufacturer Netafim opened its first North African manufacturing plant in Morocco. The plant is based in Kenitra, Morocco, and will create 200 jobs.
March 7: Sharaka officially launched ‘Sharaka Bahrain.’
March 9: The first Israeli parliamentary delegation to make an official visit to Bahrain arrived in Manama ahead of the Inter-Parliamentary Union (IPU) Conference.
March 12: Hebrew University became the first Israeli university to launch a certified undergraduate course about the UAE. The course, entitled “The Geopolitics of the UAE,” which delves into the history, geography, and politics of the UAE, quickly filled to capacity.
March 13-15: Start-Up Nation Central’s “Connect2Innovate” Conference took place in Manama, Bahrain, a first-of-its-kind event which saw the participation of more than 500 Bahraini, Emirati, and Israeli business leaders.
March 14: A high-ranking delegation from the Israeli Association of Water and Sanitation Authorities, along with five deputy mayors of Israeli municipalities, visited Morocco, holding meeting with leaders of the water sectors in Marrakech and Casablanca.
March 14: The UAE and the Anti-Defamation League announced the establishment of the Manara Center, a regional center for coexistence located in Abu Dhabi, which will promote religious tolerance and understanding in the region.
March 14-22: Sharaka brought the first delegation of Israeli-Arab influencers to Bahrain, where the group visited the Bahrain Fort, or Qal'at Bahrain, a UNESCO World Heritage site; met with government leaders; and toured Manama’s historic synagogue.
March 15: Israeli cybersecurity company Cyberint signed an agreement with Emirati telecom company etisalat by e& to help secure its cyberinfrastructure from criminal activity.
March 16: Alpha Solar, a leading energy provider in Bahrain, and BladeRanger, an Israeli climate-tech start-up, announced a partnership aimed at assisting solar site owners in the Gulf.
March 21: Israeli President Isaac Herzog spoke on the phone with Kosovar President Vjosa Osmani Sadriu, highlighting commitment to growing cooperation between the two countries.
March 23: In the first ministerial level meeting between Israel and Morocco since the establishment of Israel’s new government, Israeli Minister of Innovation, Science, and Technology Ofir Akunis met with Moroccan Minister of Water and Equipment Nizar Baraka on the sidelines of the UN Water Conference in New York.
March 24: Israeli Minister of Innovation, Science, and Technology Ofir Akunis met with UAE Minister for Climate Change and Environmental Protection Mariam Al Maheiri on the sidelines of the UN Water Conference in New York.
March 26: The UAE and Israel signed the historic Comprehensive Economic Partnership Agreement, a broad free trade agreement between the UAE and Israel which covers 96 percent of the trade between the two countries.
March 26: Mukhtar Mammadov, the first-ever Azerbaijani ambassador to Israel, presented his credentials to President Isaac Herzog.
March 27: Former Israeli Prime Minister Naftali Bennett met with Emirati President Sheikh Mohamed bin Zayed al Nahyan in Abu Dhabi.
March 27: The Museum of Jewish Culture in Fez, Morocco was completed. The museum’s exhibits include antiques, documents, and personal artifacts. It will open its doors soon.
March 27-29: The Jerusalem Center for Public Affairs hosted a first-ever Arab-Africa Conference in Jerusalem, which included representatives from Sudan, Somalia, South Sudan, Morocco, Djibouti, Mauritania, South Africa, Uganda, Nigeria, the UAE, Bahrain, and Saudi Arabia, among others. The conference centered around important discussions and strategic initiatives on food and water security, counterterrorism, anti-radicalism, and strengthening the Abraham Accords.
March 28: Emirati gas company Abu Dhabi National Oil Company entered a joint bid with British Petroleum to purchase half of Israeli energy company NewMed Energy, with the aim of taking the company private.
March 28: The United Arab Emirates officially recognized Israeli driver’s licenses, allowing Israeli tourists and residents to operate vehicles in the UAE.
March 28: Emirati Ambassador to Israel Mohamed Al Khaja hosted a Ramadan Iftar for the first time in Israel, joined by members of the Jewish, Muslim, Christian, and Druze communities of Israel.
March 29: The Israeli Ministry of Transportation approved the addition of seven additional weekly flights to Dubai.