Full potential of Abraham Accords will take time to realise, says UAE venture capitalist

On September 15, 2020, the foreign ministers of the UAE and Bahrain joined Israel's prime minister on the lawn of the White House. The trio had shocked the world by signing the Abraham Accords, one of the most significant diplomatic achievements in the history of the modern Middle East.

For its more than 70 years of existence, Israel had known mostly enmity with its Arab neighbours. Only Egypt and Jordan recognised Israel’s existence, and that came as the result of bloody wars.

The Abraham Accords promised something far better: peace built on “mutual understanding and coexistence” – Israel finally had its first Arab friends.

The fifth paragraph of the accords detailed how the signatories planned to build this relationship: “We support science, art, medicine and commerce to inspire humankind, maximise human potential and bring nations closer together.”

Three years on, venture capitalist Sabah Al Binali of OurCrowd – the first Emirati partner at an Israeli firm – sat down with The National to give his assessment of the current state of UAE-Israel commerce.

“I believe the potential of the accords is much bigger than many think,” he says from his office in Abu Dhabi.

But Mr Al Binali is not starry-eyed – it has been a rocky start. Business is still business, and three years on, he thinks there is lots of work and introspection to be done.

“There’s a phrase in venture capital to describe a problem many tech companies face: the valley of death. It’s when a firm sees an opportunity and has developed something, but hasn’t yet got market validation,” he explained.

“They get overexcited, and then things drop suddenly. I believe we find ourselves in such a place.

“There was a big flurry of meetings at the beginning. But meetings aren’t activity. Activity is learning what each side wants and finding commonalities.”

It is not an admission of defeat. Bilateral trade between the UAE and Israel still reached more $2.5 billion in 2022.

But Mr Al Binali says it is crucial to learn from early growing pains if the commercial side of the accords is to grow in the years ahead.

“Many people thought it would take a shorter time to fulfil commercial potential than I ever did,” he said.

It is important to remember that the UAE and Israel were markets that had never met. They needed time to get to know each other and figure out how to work together

Sabah Al Binali,
partner at Israeli firm OurCrowd

“It is important to remember that the UAE and Israel were markets that had never met. They needed time to get to know each other and figure out how to work together.”

Early optimism caused a rush, and in that rush, not enough commercial players have “rolled up their sleeves and taken time to understand the other side”.

Stereotypes went unchallenged, leading to many companies misunderstanding the moment and quite how big, and also complex, the opportunity really was.

Mr Al Binali believes one of the main stereotypes that still lingers is that “innovation and technology comes from Israel and that capital comes from the UAE”.

“That’s limiting and untrue. The Emirates has innovation in services, freight, hotels and airlines, for example, and Israel has significant capital access from around the world,” he said.

“People talk about high expectations that fell short. I disagree. One part of the expectation fell short because people got overexcited about the time it would take to learn to work with each other.”

Life before venture capital might have helped Mr Al Binali adjust sooner than others. Israel and the Jewish world was not a surprise for him.

“I spent 10 years in the US as an undergraduate at Princeton University where there’s a big Jewish community. I made a lot of friends there. I then went to Columbia University for graduate school, where my supervisor was Israeli,” he said.

When OurCrowd approached him soon after the accords were signed, rather than starting to scramble for deals, the firm opened OurCrowd Arabia, an outpost that Mr Al Binali said was crucial to both sides understanding one another.

“Other enterprises came in never having worked with each other, and with certain preconceived notions,” he added.

“There’s nothing necessarily wrong with that. It’s how start-ups work. You have a preconceived notion, you test it, and it very rarely works the first time. So you adjust.

“On the whole, that adjustment hasn’t been happening, except in our case. I hope others start doing it, particularly as we start showing how the process works.”

In the short to medium term, Mr Al Binali thinks this adjustment phase creates favourable conditions for “a few focused companies” rather than the high number of “very large groups” that rushed in during the early, giddy days right after the accords.

“You can’t rush markets and economies. They’re like huge anchors … But I still think that this is going to pay off in a big way,” he said.

“It goes back to how to find an operating model that works for all the stakeholders.”

Even the successful pioneers of UAE-Israel commerce have not found that model yet. But Mr Al Binali does have a benchmark for success in the years ahead.

“At the 10-year anniversary of the Abraham Accords, I don’t just want to see more Emirati companies going to Israel and more Israeli companies coming to the Emirates,” he said.

“I want to see Emiratis and Israelis working together, building companies and bringing their different but complementary skill sets, networks and visions to build truly sustainable companies.”

Tamkeen's offering

Option 1: 70% in year 1, 50% in year 2, 30% in year 3
Option 2: 50% across three years
Option 3: 30% across five years

Israel Palestine on Swedish TV 1958-1989

Director: Goran Hugo Olsson

Rating: 5/5

Why seagrass matters

Carbon sink: Seagrass sequesters carbon up to 35X faster than tropical rainforests
Marine nursery: Crucial habitat for juvenile fish, crustations, and invertebrates
Biodiversity: Support species like sea turtles, dugongs, and seabirds
Coastal protection: Reduce erosion and improve water quality

World Mental Health Day

Troubled adolescents and cancer patients in sharp focus

Social media cause of unbearable pressure among young people, says parent

Cycle of anti-depressants proves difficult to break

Residents find insurance patchy when it comes to treatment

It Was Just an Accident

Director: Jafar Panahi

Stars: Vahid Mobasseri, Mariam Afshari, Ebrahim Azizi, Hadis Pakbaten, Majid Panahi, Mohamad Ali Elyasmehr

Rating: 4/5

Farage on Muslim Brotherhood

Nigel Farage told Reform's annual conference that the party will proscribe the Muslim Brotherhood if he becomes Prime Minister.
"We will stop dangerous organisations with links to terrorism operating in our country," he said. "Quite why we've been so gutless about this – both Labour and Conservative – I don't know.
“All across the Middle East, countries have banned and proscribed the Muslim Brotherhood as a dangerous organisation. We will do the very same.”
It is 10 years since a ground-breaking report into the Muslim Brotherhood by Sir John Jenkins.
Among the former diplomat's findings was an assessment that “the use of extreme violence in the pursuit of the perfect Islamic society” has “never been institutionally disowned” by the movement.
The prime minister at the time, David Cameron, who commissioned the report, said membership or association with the Muslim Brotherhood was a "possible indicator of extremism" but it would not be banned.

MATCH DETAILS

Barcelona 0

Slavia Prague 0

Sri Lanka-India Test series schedule

1st Test India won by 304 runs at Galle
2nd Test Thursday-Monday at Colombo
3rd Test August 12-16 at Pallekele

The specs: 2018 Jeep Grand Cherokee Trackhawk

Price, base: Dh399,999
Engine: Supercharged 6.2-litre V8
Gearbox: Eight-speed automatic
Power: 707hp @ 6,000rpm
Torque: 875Nm @ 4,800rpm
Fuel economy, combined: 16.8L / 100km (estimate)

MATCH INFO

Syria v Australia
2018 World Cup qualifying: Asia fourth round play-off first leg
Venue: Hang Jebat Stadium (Malacca, Malayisa)
Kick-off: Thursday, 4.30pm (UAE)
Watch: beIN Sports HD

* Second leg in Australia scheduled for October 10

DEADPOOL & WOLVERINE

Starring: Ryan Reynolds, Hugh Jackman, Emma Corrin

Director: Shawn Levy

Rating: 3/5

Most%20ODI%20hundreds

%3Cp%3E49%20-%20Sachin%20Tendulkar%2C%20India%0D%3Cbr%3E47%20-%20Virat%20Kohli%2C%20India%0D%3Cbr%3E31%20-%20Rohit%20Sharma%2C%20India%0D%3Cbr%3E30%20-%20Ricky%20Ponting%2C%20Australia%2FICC%0D%3Cbr%3E28%20-%20Sanath%20Jayasuriya%2C%20Sri%20Lanka%2FAsia%0D%3Cbr%3E27%20-%20Hashim%20Amla%2C%20South%20Africa%0D%3Cbr%3E25%20-%20AB%20de%20Villiers%2C%20South%20Africa%2FAfrica%0D%3Cbr%3E25%20-%20Chris%20Gayle%2C%20West%20Indies%2FICC%0D%3Cbr%3E25%20-%20Kumar%20Sangakkara%2C%20Sri%20Lanka%2FICC%2FAsia%0D%3Cbr%3E22%20-%20Sourav%20Ganguly%2C%20India%2FAsia%0D%3Cbr%3E22%20-%20Tillakaratne%20Dilshan%2C%20Sri%20Lanka%0D%3C%2Fp%3E%0A

Why it pays to compare

A comparison of sending Dh20,000 from the UAE using two different routes at the same time - the first direct from a UAE bank to a bank in Germany, and the second from the same UAE bank via an online platform to Germany - found key differences in cost and speed. The transfers were both initiated on January 30.

Route 1: bank transfer

The UAE bank charged Dh152.25 for the Dh20,000 transfer. On top of that, their exchange rate margin added a difference of around Dh415, compared with the mid-market rate.

Total cost: Dh567.25 - around 2.9 per cent of the total amount

Total received: €4,670.30

Route 2: online platform

The UAE bank’s charge for sending Dh20,000 to a UK dirham-denominated account was Dh2.10. The exchange rate margin cost was Dh60, plus a Dh12 fee.

Total cost: Dh74.10, around 0.4 per cent of the transaction

Total received: €4,756

The UAE bank transfer was far quicker – around two to three working days, while the online platform took around four to five days, but was considerably cheaper. In the online platform transfer, the funds were also exposed to currency risk during the period it took for them to arrive.

Transgender report

'I pretend I'm dumb so they can't hear my voice': Transgender Emirati on posing as a woman for work

'The person in the mirror was not me': Emirati tells of gender struggle from childhood to adulthood

The burning issue

The internal combustion engine is facing a watershed moment – major manufacturer Volvo is to stop producing petroleum-powered vehicles by 2021 and countries in Europe, including the UK, have vowed to ban their sale before 2040. The National takes a look at the story of one of the most successful technologies of the last 100 years and how it has impacted life in the UAE.

Read part three: the age of the electric vehicle begins

Read part two: how climate change drove the race for an alternative

Read part one: how cars came to the UAE

Our family matters legal consultant

Name: Hassan Mohsen Elhais

Position: legal consultant with Al Rowaad Advocates and Legal Consultants.

More from Rashmee Roshan Lall

US VP candidate Kamala Harris and the complexity of racial identity

Beirut blasts: What do we do with the world's ammonium nitrate?

How the pandemic is testing the solidarity of the European Union

When it comes to peace, is the EU really a great power?

Blonde

%3Cp%3E%3Cstrong%3EDirector%3A%20%3C%2Fstrong%3EAndrew%20Dominik%3Cbr%3E%3Cstrong%3EStars%3A%20%3C%2Fstrong%3EAna%20de%20Armas%2C%20Adrien%20Brody%2C%20Bobby%20Cannavale%3Cbr%3E%3Cstrong%3ERating%3A%20%3C%2Fstrong%3E3%2F5%3Cbr%3E%3C%2Fp%3E%0A

BMW M5 specs

Engine: 4.4-litre twin-turbo V-8 petrol enging with additional electric motor

Power: 727hp

Torque: 1,000Nm

Transmission: 8-speed auto

Fuel consumption: 10.6L/100km

On sale: Now

Price: From Dh650,000

Global institutions: BlackRock and KKR

US-based BlackRock is the world's largest asset manager, with $5.98 trillion of assets under management as of the end of last year. The New York firm run by Larry Fink provides investment management services to institutional clients and retail investors including governments, sovereign wealth funds, corporations, banks and charitable foundations around the world, through a variety of investment vehicles.

KKR & Co, or Kohlberg Kravis Roberts, is a global private equity and investment firm with around $195 billion of assets as of the end of last year. The New York-based firm, founded by Henry Kravis and George Roberts, invests in multiple alternative asset classes through direct or fund-to-fund investments with a particular focus on infrastructure, technology, healthcare, real estate and energy.