The UAE and Israel's export credit agencies signed a cooperation agreement aimed at boosting trade ties between the two countries.
Etihad Credit Insurance and the Israel Foreign Trade Risks Insurance Corporation (Ashr’a) will cooperate in supporting exports, trade and investment between the two markets, ECI said in a statement on Sunday.
“This first-of-its-kind agreement between the export credit agencies of UAE and Israel is a result of the giant leap for sustainable peace" through the signing of the Abraham Accords, Massimo Falcioni, chief executive of Etihad Credit Insurance, said.
“With state guarantees from both countries, this deal will encourage exports and investments, help minimise political and commercial risks, and raise export financing for the mid- and long-term,” Nissim Ben Eli, chief executive of Ashr’a, added.
The UAE and Israel normalised relations after signing the Abraham Accords in September. Since then, a number of other pacts have been signed to foster co-operation in sectors ranging from aviation to finance. The annual exchange of trade between the UAE and Israel is expected to reach $4 billion a year, according to the ECI.
The deal between the export credit agencies is expected “to ease access to export credit facilities" for exporters and minimise risks associated with non-payment. It will cover companies in key sectors in both markets including agriculture, water treatment, renewable energy, medical and health care, aluminium, steel, cables, petrochemicals and technology.
“The historic agreement is now ushering a fresh start of economic relations," Mr Falcioni said. "ECI is ... confident that this alliance will be a game changer in terms of generating an efficient exchange of expertise that would bolster the trade and export communities of our respective countries."
Established in 2018, ECI provides export guarantees and trade insurance to mitigate the political and commercial risks of international trade on behalf of the UAE government. The entity has partnerships with local and international banks that can offer loans to UAE companies to fund exports to overseas buyers, with ECI providing insurance.
The two entities will also explore mutual opportunities for co-insurance services for exporters and facilitating market access to SMEs. They will also share best practice in areas like risk management and underwriting as well as carrying out country risk assessments.
“With accessibility to a vast array of export credit, financing and investment insurance products, the exporting communities in both countries stand to benefit from this strategic deal,” the statement said.