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The UAE and Israel signed the historic new Abraham Accords Peace Agreement on September 15, 2020. This peace agreement comes after more than 25 years. The last time Israel signed a peace deal to normalize relations with a major Arab country was with Jordan in 1994 and Egypt in 1979 before that. Following the footsteps of the UAE, Sudan also announced the Abraham Accords Peace Agreement with Israel in October 2020.
ConsTrack360 expects these peace deals and more that follow to be a significant turning point for the construction industry in the Middle East region. The UAE, having one of the largest construction industries globally, is a good match with Israel, renowned for its technological innovation. As a result, ConsTrack360 expects the Abraham Accords Peace Agreement between the UAE and Israel to disrupt the real estate and infrastructure industry in the Middle East.
Labor shortage and the value of robotics and automation
The construction industry in the UAE, especially in Dubai, is booming thereby attracting players from around the globe.. However, this has resulted in overheating of the market and subsequently leading to a shortage of labor and skills in 2021.
Therefore, Israel being renowned for its technological innovation becomes a good match for the UAE by delivering innovative technology focused on augmenting skilled labor with machines. From this perspective, the brokered Abraham Accords deal between the UAE and Israel would not have come at a better time.
The new Abraham Accord between the two countries will attract investment in technology to fuel the growth of the booming construction sector in the Middle East. UAE is aware of the value that automation and robotics have to offer. Therefore, it is one of the areas that can disrupt the infrastructure sector in the country, while addressing the labor shortage issues.
Dubai-based logistics firms partnering with Israeli port operator
Soon after signing the historic peace agreement, Dubai-based logistics firm DP World partnered with Israeli port operator DoverTower. Under this strategic partnership, both the companies are expected to work towards the development of infrastructure in the region, which will be used for trade between the UAE and Israel.
In addition, the Dubai-based logistics firm will also assess the development ports in Israel. Moreover, the company is also looking for the potential establishment of a shipping route between Jebel Ali and Eilat. With trade between the two countries expected to be in excess of US$10 billion, ConsTrack360 expects more such collaborations between other Arab countries and Israel.
Growing tourism between the two countries
Ever since the two countries signed the Abraham Accords normalization agreement, several thousands of Israeli tourists have visited the UAE. In fact, from September 2020 to December 2020, more than 50,000 tourists have visited the UAE as per official figures. These growing tourism activities in the UAE are expected to support the growth of the hospitality and commercial construction sector in the country. With UAE spending billions of dollars every year to make the region a global tourist destination, the Abraham Accords between the two countries is expected to further push the spending on the construction of hotels and recreational facilities in the UAE.
While other Arab countries such as Oman and Qatar are still in discussion to broker the Abraham Accords agreement with Israel, ConsTrack360 expects the growing tourism between the two countries will support the growth of the construction industry across the Middle East. Moreover, a similar trend is expected in Israel once the coronavirus restrictions are lifted, and the tourism activities get started in the country. With an expectation of more than 100,000 tourists every year, this peace deal between the two nations will boost the hospitality construction industry in Israel.
