They are also highly integrated economies to the world, with an important orientation / vocation towards foreign trade. The Emirates have the second most important economy in the Persian Gulf and its GDP is slightly less than that of Argentina, although it has less than a quarter of its population; Israel is one of the main world leaders in high technology patents, in innovation and in quantity and quality of startups, with a territory of a size comparable to that of the province of Tucumán and a population that barely exceeds 9 million.
Indeed, the Emirates have a per capita GDP that (measured in purchasing power parity, by the World Bank) exceeds $ 68,000, positioning the country in seventh place worldwide, while Israel’s is close to the 40 thousand dollars.
On the other hand, both Israel and the Emirates are located in strategic places, the Eastern Mediterranean and the Persian Gulf, in the articulation of Asia and Europe, which represents a commercial advantage.
Israel stands out internationally in the field of high technology and the defense industry, while the Emirates have been transitioning for years from an economy based on oil exports to one focused on services, such as tourism and financial activity. . The UAE’s economy is based mainly on exports, which represent almost half of GDP, and although the weight that hydrocarbon sales continue to have stands out, so does the phenomenon of re-exports, which are around 40% of sales abroad.
Although it is still necessary to know the scope of the agreements between both countries (to date the ministers of Agriculture and banks have met), it is possible to anticipate that the opening of commercial ties may mean a better amortization of freight costs for Argentina in exports to the region (extremely relevant given the distance of the area from our country) and the use of one of the countries as a focus for re-exports to the other.
Furthermore, the fact that these are two markets with high consuming capacity means, in particular, that an opportunity opens up for products food of important added value, especially viable in our country given the spread of kosher certification, which also meets the requirements of halal.
In this sense, I think it is key to understand that, now more than ever, Israel can function not only as a final destination for Argentine exports, but also as an intermediate point of these. Why not make the Israeli momentum to achieve business our ally when it comes to increasing the presence of Argentine products in the Arab market?
Like Israel, the UAE is a destination for Argentine food exports. While Emirati imports are not focused solely on this item, adverse weather conditions create a need for virtually every variety of food. Of course, this also makes competition in the sector very high.
According to INDEC data, Argentina exports to the UAE, among other products, corn, barley, soy pellets, steel foundries, dairy products, peanuts, meats, paper, electrical appliances and chickpeas. Many of these products are also exported by our country to Israel. The possibility of amortizing freight costs is, in this case, very clear. In turn, products such as pears and apples, peanuts, hake and frozen shrimp, as well as national citrus juices, which we now export to Israel, could be re-exported from here to that market.
The Israeli business community has started to take advantage of the new opening of the Emirates market by exporting or (in the case of food) re-exporting. In this context, we could envision partnerships between our producers and Israeli businessmen, the latter favored by their geographical and cultural proximity and by the support of local institutions in the renewed political scene, to jointly penetrate the Arab market. For both Israelis and Argentines, the UAE can function as an access point to nearby countries (such as India, Iran and Pakistan) and to the countries of the Gulf Cooperation Council (a political and economic union made up of six Arab states: Saudi Arabia, Bahrain , UAE, Kuwait, Oman and Qatar).
With this new regional scenario, huge possibilities open up for Argentina, which is the duty of those of us who occupy government functions to capitalize, identifying opportunities and synergies that the opening of this new relationship can mean.
Argentine Ambassador to Israel.