Normalization of diplomatic and trade relations between the UAE and Israel would open up new trade opportunities for both countries, raising bilateral trade to between $4 billion and $6.5 billion in the medium term, and about 1% to 1.5 percent of each country's GDP.

Despite possible regional geopolitical uncertainties, Atradius, a global provider of credit insurance, said that given the complementary existence of the two economies, cooperation between the two countries is likely to intensify in the long run.

According to the survey, the two countries have done around $280 million in bilateral trade in the first five months since their historic peace treaty, and the UAE has drawn around 130,000 tourists.

Direct air traffic and direct shipping lines between the two countries would help improve two-way trade even further. The “peace corridor,” or direct land connection between the two markets, would be another important trade catalyst.

The prospects for increased bilateral investments have also strengthened since the historic Abraham Accord was signed on 15^th September. The UAE recently announced the establishment of a $10 billion investment fund in Israel targeted at strategic sectors. Following a “constructive” phone call between His Highness Sheikh Mohammed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces, and Israeli Prime Minister Benjamin Netanyahu, Wam confirmed the decision. It's in addition to the $3 billion joint investment fund formed by the UAE, The US, and Israel immediately after the deal.

“We expect to see a more immediate effect on some sectors, such as healthcare and agriculture, due to pandemic-induced constraints on local and global demand. Other sectors, such as leisure and hospitality, will take time to grow boosted by the peace agreement. The normalization provides tremendous opportunities for the UAE's business community. We are ready to assist exporters in exploring trade opportunities,” D'Souza said.

The report states, despite the possibility of recessions in 2020, the economic growth outlook for both is reasonably solid. Their economies are complementary in that they each have a GDP of about $400 billion and have relatively high living standards due to small populations. Both economies are well-diversified. Each has a favorable business climate that works well for the development of a close trading relationship.

Exports of perfumery, plastics, aluminium, cement, and other building materials are all possibilities for the UAE. Medical electro-diagnostic instruments, chemical materials, and non-fermented fruit and vegetable juices are all places where Israel has a major advantage.

The UAE may benefit from Israeli expertise in healthcare and agri-technology through trade or investment. The UAE is making a concerted effort to draw international investors and is now one of the Gulf region's main recipients of FDI. The Dubai World Expo, where Israel will have its pavilion later this year, will be a fantastic place for Israeli companies to exhibit their inventions.

Israel's real effective exchange rate has already increased by nearly 8% since 2016 because of the country's increased gas output. Israeli goods were 20% more expensive as compared to UAE goods, as the dirham depreciated at the same time. The shekel will continue to improve over time, potentially pricing Israeli firms out of the UAE market.