A secret diamond agreement brings Israel and Qatar closer to establishing official relations

A secret diamond agreement brings Israel and Qatar closer to establishing official relations
A secret diamond agreement brings Israel and Qatar closer to establishing official relations

After years of official boycott on its part, and even real opposition to the Abrahamic agreements, it was Qatar that reached a commercial agreement with Israel in the diamond industry. Although the agreement relates to a seemingly technical settlement in an important economic sector, it indicates direct direct relations between the countries and contacts on the issues at hand. According to one of the parties involved in these contacts, Qatar will have no problem reaching further economic or commercial agreements with Israel, as long as it suits its interests as happened in the diamond agreement. Qatar, he recalls, will host the FIFA World Cup, the World Cup next year, and has pledged to allow any tourist who wishes to attend the Games. It must prove to the world that it will live up to its commitment, and the diamond agreement with Israel indicates its desire to be open to the world.

Globes has learned that the governments of Israel and Qatar have reached a trade agreement in the field of diamonds, according to which Israel will allow Qatar to enter the list of countries eligible to trade in diamonds. Qatar has pledged to allow Israeli traders to enter without difficulty and even to establish a delegation if they wish, even though there are no diplomatic relations between the two countries, and Qatar’s “bad girl” of the Gulf has opposed Abraham’s agreements with the Emirates and Bahrain. The agreement was signed by senior representatives from the foreign ministries of the two countries.

First commercial agreement after the severance of the relationship

The Gulf state intends to establish a free trade zone that will specialize in diamonds, gemstones and gold, and later also to establish a diamond exchange, similar to the Dubai model. The process still needed final approvals from the plenum of the member states of the Kimberly Treaty, and the establishment of a stock exchange for the approval of the Stock Exchange Federation, but after the removal of the Israeli opposition, Qatar’s road is paved.

The direct economic significance of the agreement is not high, at least not in the coming years. According to industry executives in Israel and the Dubai Stock Exchange, it will take a long time for Qataris to establish significant trade, and a foothold in a field dominated by veteran and powerful players. The close and direct Israeli connection to the Dubai Diamond Exchange provides the connections to traders from countries that do not have diplomatic relations with Israel. And yet, the importance of the agreement is that it is the first commercial agreement after the severance of relations between the countries, after Operation Cast Lead, and after the signing of the Abrahamic agreements – and that it is an opening for future economic-commercial agreements.

Qatar, a peninsula between Bahrain and the Emirates and bordering Saudi Arabia alone, has less than 3 million inhabitants, but with a huge annual output of more than $ 200 billion and one of the highest per capita GDPs in the world of $ 133,000 (2019 data). Like its neighbors, it is also trying to break free from dependence on oil and gas, but at a slower pace than the UAE. She is trying to gain international legitimacy and so she competed and won the World Cup, but along the way it turned out that several of the deciding factors were bribed for this purpose. It later emerged that in the process of building the giant stadiums in the country, more than 6,500 foreign workers were killed and working conditions there are defined as slavery conditions. The Qataris have not yet solved the problem of visas for football tourists from countries like Israel, nor the issue of alcohol, which is banned from sale in the country, but is an integral part of world football.

Reconciliation with the Saudi bloc promoted the move

The story began about three and a half years ago – the Qataris hired the services of a well-engaged Russian jeweler in the industry’s international trade moves. They already tried to convene the Kimberley Process Committee responsible for global regulation of the diamond trade, and the Diamond Exchange Federation to obtain a trade permit on the way to establishing their own stock exchange, but Yoram Debash, who was then vice president of the Diamond Exchange Federation and president of the Israeli Diamond Exchange, stopped The move, in part with the help of the UAE, which also opposed it.

Yoram Debash, President of the Diamond Exchange / Photo: Gil Lavie

About six months ago, they renewed contacts, and raised the matter again before the Kimberley Process Committee. This committee requires unanimous approval, and every country, including Israel and the United Arab Emirates, has a right of veto. The realtors, again from Russia, acted on the line, and consultations began in Israel. Among their partners were the director general of the Ministry of Economy, Dr. Ron Malka; The Supervisor of Industry at the Ministry of Economy, Ofir Gur; The Israeli representative on the Kimberly Commission, Yoram Debash, who has meanwhile been appointed President of the World Federation of Diamond Exchanges; President of the Israel Diamond Exchange, Boaz Moldavsky, and his staff; Foreign Ministry Director General Alon Pinkas; and of course Foreign Minister Yair Lapid and Economy Minister Orna Barbibai.

The Foreign Ministry saw the opportunity to continue the momentum of the Abrahamic Agreements, even if it was not a full normalization agreement, but a seemingly technical arrangement in a specific trade industry. The Ministry of Economy and the Diamonds feared harm to Israeli diamond merchants as access to the stock exchange and the Qatari free trade area would at best be limited to impossible due to the lack of official ties between the two countries. According to a source involved in the consultations, the final decision was made in a conversation between the foreign minister and the economy minister.

The Emirates, which has been in full coordination with Israel in the diamond industry for years, finally lifted their opposition. Thanks in part to the thaw between the Saudi bloc of which they are a part and Qatar. Qatar has been in conflict with Saudi Arabia, the Emirates and Egypt for various reasons, including the country has been accused of owning the Al Jazeera network which is whipping up internal conflicts, mainly in Egypt. But after three years of confrontation and hostility the reconciliation was achieved, and in January the ruler of Qatar, Tamim Ben Hemed, visited Saudi Arabia and reconciliation was complete.

Tamim Ben Hemed Al Thaniya, Amir Qatar / Photo: Associated Press

Amirat Foreign Minister: Competition is good for business

In a conversation with Globes, the Minister of Foreign Affairs of the United Arab Emirates, Dr. Thani al-Zaudi, explained that the considerations for the emirate’s position on the issue were purely commercial-economic.

Following the amicable agreement, contacts between Israel and Qatar became direct, and the Qataris initially presented a general commitment that any trader from any member state of the Diamond Exchange Federation could attend. The Russian representatives in the international organization pledged to Qatar but in Israel insisted on an orderly and rapid procedure unique to Israelis, due to the official diplomatic rift between the countries, and finally the Qataris agreed.

According to the secret arrangement established, and agreed between the Foreign Ministry and the Ministry of Economy and the Government of Qatar, contacts were established in Israel (President of the Diamond Exchange) and in Doha, for applications for entry and trade visas. The Qataris have promised to respond to visa applications within up to five days and also to any Israeli trader who wishes to do so will be able to open a diamond trade office in the free trade in diamonds and jewelery planned for the future stock exchange.

In between there were also incidents and disconnections, such as when Ophir Gur from the Ministry of Economy was scheduled to fly to Qatar to take part in the examination and control of the Kimberley Process over the Qataris ahead of the discussion of their application. Qatar has announced at the last minute that they are demanding that he arrive on a flight of their national airline. Israel refused and Gur did not leave. The Qataris apologized for this in a letter they sent. But in the end the agreement was reached as stated, and Qatar was added to the list of countries participating in the international diamond trade.

Evidence of Israel’s growing status

Dr. Ron Malka, director general of the Ministry of Economy and Industry, confirmed the details of the story to Globes. He said that following the ministry’s close and ongoing dialogue with Israeli diamond miners and the Foreign Ministry, Israel had received an undertaking that the interests of Israeli diamond miners would not be harmed and that they would not be discriminated against compared to other diamond miners in access to the Qatar Trade Center. Following this commitment, Israel did not object to Qatar joining the organization. According to Malka, the story points to Israel’s growing and central position in the commercial-economic world. Asked whether the agreement with Qatar heralds further agreements, he replied that Israel is ready and open to any initiative and appeal from any country in the region, including Qatar.

Ron Malka, Director General of the Ministry of Economy / Photography: Ministry of Foreign Affairs

In response to Globes’ request, the Israeli Diamond Exchange responded that they welcome the achievement, noting that it is a very important move that opens up new markets for Israeli diamond dealers and the diamond industry, which continue to advance the economy and represent the country around the world.

Debash, president of the World Federation of Diamond Exchanges, also confirmed the story to Globes, saying that it was clear to Qatar that without Israeli consent they could not be a legitimate player in the diamond industry. According to him, if the Qataris do submit an application to open a diamond exchange in this Doha, it will be examined according to the required professional criteria and also according to the principle of free access to all other players from around the world, including Israel.

Qatar does not want to stay out

Talks with diplomatic and commercial figures in the field of trade with the Gulf states indicate that the move indicates a combination of Qatar’s need and interest and its desire not to be left out, in the new diplomatic balance in the Middle East after the Abrahamic agreements. Qatar was previously a pioneer in turning west and progress, being the first to bring American forces into its territory and opening the international news network in Arabic and English al-Jazeera. She was also a pioneer in relations with Israel. During the time of the late Oslo Accords, the then Foreign Minister, Shimon Peres, met several times with its leaders, and in 1996 mutual representations were opened in Tel Aviv and Doha. In 2007, Sheikh Saud bin ‘Abd a-Rahman, the chairman of the Olympic Association of Qatar, visited Israel and laid the cornerstone for the Doha Stadium funded by his country for the Bnei Sakhnin team.

Official ties were severed in 2009 with Operation Cast Lead by the Olmert government. In recent years, as part of its attempts to return to influence, Qatar has begun funding various projects in the Gaza Strip, and Amir Qatar’s innocent Sheikh Ben Hemed al-Thani even said in 2017 that relations between Qatar and Israel are good. For the past two years, Qatar has been funding both diesel for the power plants in the Strip and money for 10,000 needy families in the Strip every month. As part of the talks on the subject, Yossi Cohen, former head of the Mossad, visited Doha.

However, after the signing of the Abrahamic Accords with the Emirates and Bahrain, Qatar announced that it would not join them until a solution to the conflict with the Palestinians was found.

The agreement we are now reporting on may be a sign of a certain thaw on the part of Doha, and of the possibility of commercial or other economic agreements, even if not diplomatic agreements and full normalization. According to those involved in the field in Qatar, they see the commercial economic success of the Avraham agreements and the great potential inherent in them and are looking for an elegant way to join the move, even partially. Another point to think about: One of the Hamas leadership’s headquarters, in Doha, is generously hosted by the authorities.

For Israel, such a compromise may bear good fruit, certainly on the economic and commercial level, but perhaps also in the political aspects, in the exclusion of Qatar from the countries and organizations in conflict with Israel and its proximity to the moderate Gulf Sunni alliance.

 
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