A Tale of Two Normalizations: Israeli Normalization with the United Arab Emirates (UAE) – Part I

The “Treaty of Peace, Diplomatic Relations and Full Normalization Between the United Arab Emirates and the State of Israel” was signed on September 15, 2020. On the same day, Bahrain and Israel signed their “Declaration of Peace, Cooperation, and Constructive Diplomatic and Friendly Relations.” Since then, bilateral relations between the two states and Israel have progressed speedily, with many more issue-specific agreements signed and economic relations with the Emirates burgeoning. The Negev Conference on March 28, 2022, which was attended by the U.A.E., Bahrain, Egypt, and Morocco, as well as the United States, symbolized a maturing and coalescence of the regional normalization processes between Israel and conservative Arab states.

This paper will address recent developments in the foreign policy of U.A.E. that impact the current status of relations with Israel, as well as recent developments in relations between the two states.[1]

Ukraine, and the United States

The foreign policy of U.A.E. is strongly influenced by its perception of key developments on the global level, especially the current and future vector of U.S. policy and presence in the MENA region, the U.S. having served as their main strategic partner and bulwark in the past four decades; the rise of China and of the U.S.-Chinese strategic rivalry; the long-term trend of decarbonization; and most recently, the renewed strategic conflict between the United States and Russia. On the regional level, they are influenced by the continued instability engendered by the Arab uprisings of 2011-2013, throughout the region but especially in Yemen, Libya, and Syria; the enlarged influence and power of Israel, Iran, and Turkey in the region in the past two decades; and the balance and competition among these players, and between them and the Gulf states.

The war in Ukraine, and the demand by the United States that its partners adopt its stand and adhere to its policies towards Russia, have highlighted all these issues. This issue has further strained already fraught relations between Washington and Abu Dhabi (and Riyadh), with the latter demurring from sanctions on Russia, as well as from U.S. requests to increase oil production (and renege on production agreements reached with Russia); Sheikh Mohamed bin Zayed (“MbZ”),[2] the Crown Prince of Abu Dhabi, and Mohamed bin Salman (“MbS”), the Crown Prince of Saudi Arabia, even declined calls from President Biden.[3]

There is great concern in U.A.E. about current U.S. policy towards Russia. Mohammed Baharoon, of the Dubai-based B’huth: Dubai Public Policy Research Centre, explains that U.A.E. views the global system as “networked.” This perspective rejects the concept of polarity, and the “zero-sum calculus that underpinned the Cold War era … the U.A.E.’s economic relations with China do not devalue its relationship with the United States. Nor does diplomatic engagement with Russia over Syria constitute a departure from its strategic relations with the U.S.”[4] In Baharoon’s view, U.A.E. sees “connectivity corridors” - especially maritime trade and ports (Dubai’s DP World is a world leader in the field), financial flows, and free movement of people and data – resulting from its geostrategic location, as key to its agenda (as well as its power and influence). U.A.E. and others that have fully endorsed and heavily invested in a globalized economy are now, he notes, having difficulty coming to terms with how quickly the unipolar world order that heralded globalization is falling apart. Emirati long-term strategies are predicated on the globalized world order that the U.S. previously created, and are threatened now with disruption. [5]

The U.S., in its attempt to assert global hegemony, is seen as having “weaponized” its control of many of the levers of the international economy.[6] The U.A.E. sees danger in an “acute bipolar order” in which the U.S. uses its control of global economic and technology infrastructure to pursue its particular goals, threatening U.A.E.’s globally-oriented economy. For example, Emirati interlocutors pointed out that the United States dispossessed Russian citizens of their property by fiat, without legal recourse.[7] This is leading Emirati circles to examine the need to diversify and shift some of their economic infrastructure to channels that cannot be manipulated for American interests (for instance, those which China is developing). American (and British) pressure on Saudi Arabia and U.A.E. to violate OPEC+ production agreements in order to lower oil prices in the wake of the Ukraine crisis, are seen as an attempt to break OPEC, and to shatter the control mechanisms painstakingly constructed in recent years with Russia, directly damaging Saudi and Emirati interests.

The U.A.E., like all the Gulf states, is concerned about, and preparing for, American disengagement from the region. The U.S. has assigned a higher priority to China and the Indo-Pacific region and a lower priority to containing Iran’s regional power. The U.A.E.’s concerns were stoked by the retreat from Afghanistan, which renewed questions about the American resolve to stand by its traditional regional partners. These fears are part and parcel of the logic of the normalization process with Israel; the region needs robust security partnerships, which can stand in, at least in part, for dependence on the U.S.

A “Reset” in Emirati Regional Policy

Well before the Ukrainian crisis, there was a sea-change towards a more emollient Emirati foreign policy (matched by a similar reorientation by Saudi Arabia). The U.A.E. leadership under MbZ, seems to have decided to discard its costly, adventurist national security policy of the past decade, which has not proven itself and is also much less acceptable to the Biden Administration than to the Trump Administration. It also seeks to exploit to its utmost political and economic opportunities that have arisen. This reorientation has been most pronounced regarding Turkey, Iran, and Syria.[8]

Baharoon argues that a key component of a “networked world order is the replacement of the concept of grand competition with a strategy for ‘grand complementarity’, of which relations with Turkey and Iran are examples.”[9] Dr. Ebtesam Alketbi, a prominent Emirati analyst, speaks of Emirati efforts to adopt a “zero problems” policy with the countries of the region; to give priority to diplomatic solutions and soft power; and, to calm disputes with neighbors and regional parties. She quoted Emirati officials who said in October 2021 that U.A.E. is trying to manage the long-running rivalry with Iran and Turkey through dialogue, that "the coronavirus pandemic has put non-political priorities at the fore," and that U.A.E. decided to change its course, focusing on economic development as a path to security.[10] Abdulkhaleq Abdalla, a retired Emirati professor of political science, notes that the U.A.E. is “trying to consolidate its regional influence and it is trying to project itself as a peacemaker from now on."[11]

The rapprochement with Turkey is the most significant change, following a decade in which Abu Dhabi led the activist conservative camp against the opposing Sunni axis of Turkey, Qatar, the Muslim Brotherhood and political Islam (and popular politics in general) in the wake of the Arab uprisings. Today, the major threat, the Muslim Brotherhood, is perceived as being in retreat and as a spent force. Turkey is seen as having overreached in the regional policy it pursued in the past decade, and ended up isolated regionally, as well as in dire straits economically. This is the reason it is pursuing what Turkish diplomats describe as a “five-pronged diplomatic drive” toward U.A.E., Saudi Arabia, Egypt, Israel, and Armenia.[12] Turkey is, therefore, in the words of one Emirates-based researcher, “cheap to buy”.[13] Turkey is seen as having taken the first step towards the Emirates, and the UAE is willing to reciprocate and to capitalize on Ankara’s weakened position. Abu Dhabi may also be interested in using Turkey to help balance Iran’s regional power.

The surprising volte-face began with the August 18, 2021 visit by Emirati national security advisor (and MbZ’s brother), Tahnoun bin Zayed, to Ankara, where he met with Turkey’s President, Recep Tayyip Erdoğan. On November 24, MbZ himself visited Ankara. Erdoğan made a reciprocal visit to U.A.E. on February 14, 2022. During MbZ’s visit, he announced a $10 billion investment fund in multiple sectors of the Turkish economy, including energy, climate change, and trade. This should help buoy the Turkish economy, but the fact that the money will be for investments and not aid, will also provide U.A.E. with significant influence in the Turkish economy, and the ability to use Turkey as a conduit to new markets, especially in Africa. In January 2022, the two countries announced a $4.7 billion currency swap, boosting Turkey’s foreign exchange holdings and propping up the lira.[14]

The improvement in relations with Turkey has been in parallel with a détente with Qatar, starting with the al-Ula summit in January 2021, which formally ended the embargo imposed on Qatar in June 2017, due in part to its ties to Turkey and Iran (but which in fact deepened Doha’s connection to these two states). The al-Ula reconciliation was mostly a Saudi initiative, and it took Abu Dhabi some time to warm bilateral relations. However, the Qatari foreign minister visited Abu Dhabi in October 2021, after a visit to Doha by Tahnoun in August 2021; MbZ met Qatari Emir Sheikh Tamim bin Hamad al Thani in February 2022 in Beijing.

U.A.E.’s détente with Iran began already in September 2019, when after the attacks on shipping in the Gulf and on the Aramco refinery at Abqaiq, the United States and Saudi Arabia did not respond in a significant way against Iran. It then became clear to the U.A.E., whose antagonism towards the Islamic Republic had never been as all-encompassing as Saudi Arabia’s (and for whom – especially for Dubai – commerce with Iran continued to be very significant), that it did not wish to be left unaided “on the front line” facing Iran.[15]

This feeling has only been strengthened by what Abu Dhabi perceives as the weak American line towards Iran, especially regarding the nuclear talks in Vienna (whose “original sin” was the lack of consultation with U.S. regional partners before the 2015 negotiations); the delisting of the Houthis as a terrorist organization; reports that the Biden Administration was considering delisting the Iranian Revolutionary Guard Corps (IRGC); and the perceived lack of American response to missile and drone attacks on Abu Dhabi, Saudi Arabia, and even on their own installations in Iraqi Kurdistan. U.S. forces stationed in the Gulf did help intercept the Houthi attacks on U.A.E., partner air defense capabilities were beefed up, and senior American officials did visit the region afterwards to discuss Emirati concerns. Secretary of State Blinken reportedly apologized to Mohammed bin Zayed for the delay in the U.S. response to January's Houthi attacks against U.A.E. However, these steps do not seem to have ameliorated regional fears and criticisms of the U.S. resolve to support their Gulf partners. The Gulf states are reportedly pushing for formal guarantees of their security (referring to a “Middle Eastern NATO”), which are not forthcoming from Washington.[16]

Analysts in the U.A.E. and Bahrain explained the apparent dichotomy in American policy between perceived openness towards Iran and indifference towards the concerns of conservative Gulf states, in political/personal terms. The Biden Administration is referred to as the “Third Obama Administration,” with figures who took leading roles in the previous JCPOA negotiations directly involved in the current ones.

U.A.E. has also been in the forefront of efforts to return the Asad regime to the Arab fold, arguing the need to accept the reality of its survival, and the need for Arab engagement with it to reduce the Iranian presence. Foreign Minister Sheikh Abdallah bin Zayed visited Damascus in November 2021; Bashar al-Asad made a surprise visit to Dubai and Abu Dhabi in February 2022, ostensibly to visit the Syrian pavilion at the Dubai Expo 2020 on Syria’s national day (which happened to have been the anniversary of the Deraa riots, considered the beginning of the Syrian Civil War). The impetus for the visit reportedly came from the Syrian side, with little preliminary planning.[17]

MbZ has also been inserting himself into the tripartite “Arab Alliance” between Egypt, Jordan, and Iraq: He has had a series of meetings with President Abdel Fattah al-Sisi and King Abdullah II, most recently in Sharm al-Sheikh on April 24, when they discussed the situation in Jerusalem, as well as food and energy security. This axis is reported to have the blessing of U.A.E. and Saudi Arabia, as a means of separating Iraq from Iran, de-emphasizing the sectarian struggle (including by encouraging Muqtada al-Sadr), and increasing Arab influence there.[18] The summit in Aqaba on March 25, between the four countries’ leaders, seems to bear this out.

U.A.E.: Economic Relations with Israel

Economic relations between U.A.E. and Israel have burgeoned since the 2020 accord. Trade in 2021 between the two countries was $1.2 billion, compared to under $200 million in 2020,[19] though some of this may be “uncovering” of previously covert or indirect trade; it is predicted to double in 2022. Mubadala Petroleum, a unit of Abu Dhabi’s sovereign wealth fund (which also has a 10% stake in Egypt’s Zohr natural gas field, the largest discovered so far in the subregion), purchased Delek Drilling's 22 percent stake in the Tamar natural gas field, which is operated by Chevron, for one billion dollars (it is reportedly planning to sell half to an Israeli investor). In addition, Masdar, Mubadala’s renewable energy arm, has proposed to finance a major solar energy project in southern Jordan, which will provide Jordanian solar generated electricity to Israel, while Israel, in turn, will provide 200 million cubic meters of desalinated seawater to Jordan.[20] The Wall Street Journal reported in January that Mubadala also invested $100 million in six Israeli venture capital firms.[21]

On April 1, Israel and U.A.E. signed (in Jerusalem) a comprehensive free trade agreement, covering regulation, customs, services, government procurement, e-commerce and protection of intellectual property rights, the first between Israel and an Arab state. Some 95 percent of all products traded between the two nations will be exempt from duty and the agreement will also encourage trade in services by ensuring regulatory clarity and protection of intellectual property rights. From Israel’s point of view, the agreement will allow it to tap into U.A.E.’s highly developed regional and global trade network. From the Emirati side, it should enable more access to Israeli proprietary technologies, and ease their ability to invest in Israeli companies.[22]

On the other hand, Israel suspended (July 2021) the transit deal signed between an Emirati company and the secretive, government-owned, Israeli Europe Asia Pipeline Company (set up originally to handle secret oil shipments from pre-revolutionary Iran), for oil arriving from the Gulf, to flow through the pipeline from Eilat to Ashkelon, to the Mediterranean. This was due to environmental concerns in Israel regarding possible dangers to the Gulf of Eilat, and broader concerns regarding the transparency of the deal on the Israeli side, with several key ministries not having been consulted.[23] While the deal’s supporters warned of adverse effects on bilateral relations, these seem to have been overstated. In addition, a kerfuffle regarding what the Dubai authorities perceived as unreasonable and heavy-handed Israeli security demands, led to a month of restrictions on flights between Tel Aviv and Dubai and cancellations of dozens of flights, until it was resolved in late March.[24]

Public Support in U.A.E. for Normalization with Israel

There is reportedly not much public enthusiasm for the normalization with Israel in U.A.E., but also little opposition: “There is an undercurrent [against the normalization], but it is deeply buried,” said one source.[25] The population seems to trust the ruler and support his policy, and the government is legitimately popular; the caveat is of course that there is no organized political opposition in the state, and overt criticism is not tolerated, so it is hard to gauge the level of discontent. It was noted that Emiratis abroad have been critical of the Accords, a fact that might reflect trends inside the Emirate. There was little systematic anti-Israeli ideology in the education system in the past in the U.A.E (unlike in other states), and the Palestinian issue was not stressed much. A poll carried out in November 2021, a little over a year after the U.A.E.-Israel normalization agreement was signed, showed that the public views the importance of good ties with the U.S., China, and Russia as equally important. It notes a halving of those who think the Accords would have a positive effect in the region, from 44 percent after the signing, to 23 percent. This change is assessed to be due to last year’s al-Aqsa crisis and to the lack of progress in the Iran nuclear talks; such a poll this year may well show continued decline. The poll also showed that the younger generation is no more likely to support relations with Israel.[26]

A challenge to bilateral relations with U.A.E., and certainly to the improvement of “people-to-people” relations, is the Israeli-Palestinian issue, and more concretely, the issue of Jerusalem and the Haram al-Sharif/Temple Mount. The emotion-laden narrative of “settler attacks on al-Aqsa,” and unfounded allegations of dark Israeli/Jewish plans to destroy the mosque complex and rebuild the Temple, have tremendous resonance among Muslim publics and has been a perennial sore spot in Israel’s relationship with the Muslim world (sometimes fed by domestically-driven Israeli policies). The issue began to emerge in relations with the Abraham Accords states in May 2021 due to the confrontations around al-Aqsa and Sheikh Jarrah, when they released strongly worded statements. However, the rocket attacks by Hamas and violent disturbances within Israel deflected attention elsewhere.[27] This year’s Ramadan events in the mosque complex, and especially images in social media, again led to anger in the U.A.E. The Israeli ambassador in Abu Dhabi was called in for a formal protest, though the Emirati foreign minister later welcomed the Israeli decision not to permit the right-wing “Flag March,” and not to allow non-Muslim visitors to enter the al-Aqsa courtyards for the last ten days of Ramadan.[28]

Conclusion

Normalization with Israel was, for U.A.E., an integral part of both its previous, force-based, and its emerging, moderating, regional strategy. Israel is perceived as a balancer to Iranian power, as an ally in the struggle against political Islam, as part of an emerging regionally-based conservative security architecture, and as a source for security technology and in the future, perhaps assistance in defense and deterrence. It is also, and importantly, seen as a key instrument in maintaining the sometimes complex relationship with the U.S. (which may pay dividends especially if the American political map shifts again in 2024).

But the improved relationship with Israel always had a significant economic, and even ideological component: the Emirates, reshaping their economy from an energy-dependent one to one which is global, and technological-, service- and trade-based, view Israel as a rare “kindred soul” and a complementary economy in the region. Relations with Israel, as well as with Egypt and Greece, have also enabled U.A.E. to become an economic and geopolitical player in the Eastern Mediterranean, and to contemplate inter-regional infrastructure projects. In addition to this stress on economic development and modernization, the Abu Dhabi regime’s strategy is to build other aspects of its soft power, including its image (and to a large extent, reality) of religious and cultural tolerance (within a broader framework of political non-pluralism and government control); the flourishing of Jewish life in the Emirates is a central component of this. However, the regime wants to retain control over the pace and scope of normalization, and is reportedly not particularly enthusiastic about civil society initiatives “from below.” As the relations with U.A.E. and the other “Abraham Accords partners” progress into their second year, the “honeymoon” elation remains, especially on the Israeli side, for whom the Abraham Accords have been not only a strategic and economic boon, but a psychological one, shattering Israelis’ isolation in the region. However, the relations have become more real, which has included, and undoubtedly will continue to include, some complications, due to the Jerusalem and Palestinian issues, but also perhaps to the inevitable clashes between freewheeling and obstreperous Israeli business and tourist cultures and the boundaries imposed by the Emirati social and political system.

Joshua Krasna is a Research Fellow at the Moshe Dayan Center for Middle Eastern and African Studies (MDC), Tel Aviv University and a Senior Fellow in the Middle East Program at the Foreign Policy Research Institute (FPRI).