Israel, UAE Sign Tariff Deal

RAPAPORT… Israel and the United Arab Emirates (UAE) have reached a trade deal that will abolish certain tariffs on diamonds and jewelry.

The Comprehensive Economic Partnership Agreement (CEPA) will eliminate customs duties on more than 96% of products across a range of sectors, the countries said Tuesday after signing the document. It will advance bilateral trade beyond $10 billion within five years, according to a statement by the UAE’s Ministry of Economy.

Tariffs on most jewelry, diamonds and precious gems entering the UAE from Israel will drop from 5% to 0%, according to the Israeli Ministry of Economy and Industry. Some of the changes will happen immediately, while others will take place between three and five years from when the agreement goes into effect, it added.

“This CEPA with Israel will create a new paradigm for the region,” said UAE Minister of Economy Abdulla Bin Touq. “It will accelerate growth and underscores a shared belief that the only way to build resilient and sustainable economies in a complex world is by doing so together.”

In 2020, the UAE and Israel signed the Abraham Accords, which marked the normalization of relations between the two nations. The Israel Diamond Exchange (IDE) and the Dubai Multi Commodities Centre (DMCC), which contains the Dubai Diamond Exchange (DDE), later announced a cooperation deal.

Israel exported around $188 million in rough diamonds to the UAE in 2021, according to government data.

Image: Inside the Dubai Diamond Exchange. (DMCC)