by Paolo von Schirach —
WASHINGTON – The Abraham Accords signed on September 15, 2020 radically changed the political geography of the Middle East. It was not a total transformation; but the Accords broke a fairly solid “no deals with Israel” vast front that had been the major feature of regional politics, even while taking into account the normalization of relations that led to the establishment of diplomatic relations between Israel and Egypt (January 26, 1980) and then between Israel and Jordan, (November 27, 1994).
Beyond diplomacy
That said, with the Abraham Accords we have gone way beyond the establishment of normalized diplomatic relations. Particularly in the case of the UAE and Israel we see the contours of a complex set of relationships that could develop into a solid, long term strategic partnership, The two sides found agreement on a variety of economic and security fronts: from IT to agriculture, from energy and water to defense technologies. This web of bilateral agreements linking Israel and the Emirates is evolving into a most vibrant regional trade and tech artery, with identifiable benefits for both sides.
Economic deals
Let’s review the main points. Following the Abraham Accords we have bilateral trade deals between the UAE and Israel, exceeding now several billions of dollars. The agreements signed have been made possible by the UAE-Israel Comprehensive Economic Partnership Agreement (CEPA) which eliminated all tariff barriers between the two countries. Then there are many high-tech and venture capital deals in which UAE capital contributes to fund joint projects based on Israeli technologies. Working with Israeli partners, the UAE $10 Billion Investment Fund is investing in joint ventures focused on agri-tech, healthcare, renewable energy, water and Artificial Intelligence. Then we have defense ties. The UAE is seriously interested in getting access to Israeli state of the art technologies, particularly in electronic warfare and counter drones weapons. Israel in turn is keen on using the UAE as a launch platform for joint international business ventures in the region, and also Asia and Africa.
Partnerships with the Americans
At the same time, shifting scenarios, the UAE is pursuing major investments with the US in artificial intelligence and other ventures. Regarding AI, we are talking about 1.4 trillion over the next 10 years that will include U.S. tech, infrastructure and more. With entities like MGX and G42in the lead, the UAE is partnering with global US tech corporations like Oracle, Nvidia, and Microsoft to strengthen AI related global supply chains. These are massive strategic commitments backed by major financial resources. Over time, as these initiatives will develop, they will affect the growth of US companies, while making the UAE into a regional and down the line global tech leader.
Furthermore, UAE sovereign funds have invested in key US based AI labs and AI infrastructure entities. Along the same lines, Abu Dhabi based ADQ, in partnership with Energy Capital Partners, has set up a joint venture to finance the construction of energy generation plants that will provide the power required by AI data centers in the US. This level of close cooperation now allows the UAE to become a key partner in the development of US high tech, at the same time gaining access to sensitive US IT and AI technologies. And there is more. The UAE is also involved in co-funding energy generation and distribution projects in the US, including nuclear power, including scalable small nuclear reactors. These ventures have been made possible by the US-UAE Partnership for Secure Nuclear Energy, an umbrella agreement that makes it easier for US and Emirati entities to work together.
Ambitious initiatives
These ambitious, capital intensive, long term initiatives undertaken by the UAE reflect the political decision to nurture closer relations with both Israel and the United States. All this is due to a clear assessment of the available options. Abu Dhabi made the decision that it is in its national interest to be solidly in the US-led western camp when it comes to technological innovation, AI, and energy on the one hand, and defense and security on the other. By the same token, the UAE views Israel as a US ally and as the regional tech powerhouse that can help the Gulf state in its efforts of scaling up its technological prowess. This modernization will become critically important in the long run, when the strategic and economic value of hydrocarbons will be far less relevant.
No illusions about Iran
In all this, the UAE government is fully aware of Iran’s continuing security threat. Tehran still has significant missile launch and drones capabilities, even after the heavy damages caused by the sustained US and Israeli bombing campaign. And then there is the Iranian continuing influence in Iraq, Syria, Lebanon, and Yemen; not to mention Iranian proxy forces in the region and Iran’s proven capacity to halt oil and LNG tankers that must sail through the Strait of Hormuz.
The Abraham Accords signed during the first Trump administration emerged partly from a shared Emirati-Israeli perception that Iran represented the principal strategic challenge in the region. Given its geography, the UAE is and will remain vulnerable in any new conflict with Iran. Still, its leadership believes that strong relations with both Israel and the US are going to reinforce its efforts to strengthen the country’s security, while building with US and Israeli partners a new, high tech driven economic future.
The recent war against Iran (whose final outcome is still unknown at the time of this writing) reinforced this concern. The threat posed by Iranian missiles, drones and fast attack small crafts froze shipping routes and damaged energy infrastructure in the UAE, reminding Abu Dhabi that its economy and security remain vulnerable.
No accommodation
Still, the UAE did not choose accommodation with its powerful neighbor. For sure, going forward, there will be arrangements with Iran aimed at decreasing the chances of a new conflict. Still, it is wise for the UAE leadership to have chosen to reinforce its chances to survive as a sovereign nation and hopefully thrive in a future high tech global economy by strengthening its ties with the only powers that can stand up to Iran in the long run. At the same time the US and Israel have what it takes to successfully compete with China in the technologies that will define the economic future of the world.
There is a clear Emirati bet here. Iran is still a major regional power run by an elite that has hegemonic ambitions regarding the region and beyond. As the recent conflict demonstrated, Tehran has proven to be much more resilient than initially expected at the beginning of the Israel US bombing campaign that began at the end of February 2026. Still, the bet is that US and Israel have and will have more staying power, both militarily and economically. The decision to stay close to them while developing the synergies that marry UAE capital to US and Israeli tech, civilian and military, represents a smart choice on the part of the UAE government.
Paolo von Schirach is the President of the Global Policy Institute, a Washington DC think tank, and Professor of Political Science and International Relations at Bay Atlantic University, also in Washington, DC. He is also the Editor of the Schirach Report