Israeli diamond merchant Zvi Shimshi traveled to the United Arab Emirates the week after Israel and the UAE normalized relations to open a regional trading hub and company in Dubai, for precious stones.

He is one of 38 Israelis who have recently contacted the Dubai Multi Commodities Centre (DMCC), which houses the Dubai Diamond Exchange, to establish a presence that how changing regional politics could alter global trade dynamics.

Traders in Dubai claim they received numerous inquiries from Israelis who used to trade in Antwerp, Belgium, the world's largest centre for rough and polished diamond trading.

In few weeks, Trans-Atlantic Gems Sales (TAGS), a South African company that auctions and tenders diamonds in Dubai, had nearly 50 Israeli companies interested in engaging in tenders register with the company, owner Anthony Peters informs.

The Middle East's major diamond centres are Dubai with $21.2 billion in diamonds exchanged last year, and Israel $12 billion, according to its exchange. Due to regional political sensitivities, trade between the centres was limited and discreet before last month's US-brokered accords that saw the UAE and Bahrain becoming the first Arab states in a quarter-century to develop formal relations with Israel.

Shimshi entered the Gulf Arab state on a German passport but has filed company registration papers using his Israeli passport. He has confirmed that he wants to relocate his business to Dubai. The UAE has revoked a law prohibiting trade with Israel. Both Emirati and Israeli officials have hailed the opening as creating major economic opportunities, allowing direct flights between the two countries.

Dubai is a prime centre for rough diamonds. It has expanded its industry from $3 million in 2000 to $1 billion today by exploiting its proximity to Africa, where diamonds are mined, and India, where 90% of the world's diamonds are polished.

Tenders have previously been kept in Antwerp in part to allow Israelis to participate. Antwerp, saw total diamond trade of $37.1 billion last year, according to the Antwerp World Diamond Centre. It has maintained its share of the rough diamond market since 2017, according to Kimberley Process data, while Dubai's has increased. After Belgium and India, the UAE is the third-largest trading centre for rough diamonds. The top five countries are Israel and China.

"Dubai and India are taking market share away from China and Israel, but not from Antwerp," said Karen Rentmeesters, the AWDC's head of communications and industry relations. In terms of the rough diamond trade, Rentmeesters said Dubai is a competitor, while looser regulations and the ease of forming a business could be a draw, she doesn’t foresee Dubai overtaking Antwerp.

According to DMCC data, Dubai imported $4.2 billion worth of polished diamonds in 2018, $7.3 billion in 2012, and exported $3.96 billion, $5.35 billion in 2012. Dubai has the potential to become a major diamond trade network for polished diamonds, as well as a conduit for diamonds and jewelry to the rest of the Arab world. For polished stones, there is a sizable demand in Israel. Dubai brings India closer to the Arab world and binds it to the rest of the world. President of the Israel Diamond Exchange Yoram Dvash told Reuters, "We see Dubai as a golden gate."

Ezra Boaron, the owner of the Rising Star Diamonds manufacturing facility, agreed: "Dubai serves as a hub for the entire Arab world”. Coronavirus restrictions have been lifted in Dubai, and trade in the diamond exchange has resumed. Israel has been put under a second lockout due to a new wave of infections. "We will see the company expand a little more in the coming months," says Dubai Diamond Exchange Chairman Ahmed bin Sulayem.