Analysis Banking & Finance Abu Dhabi’s ADIO signs up Israeli fintechs as bilateral trade rises By Andy Sambidge November 16, 2022 ADGM Abu Dhabi Global Market, where Israeli fintech OurCrowd will open a new AI hub ADIO Innovation Programme unveils first partnerships with Israeli firmsLiquidity Group and OurCrowd will receive financial and other supportMove follows Abraham Accords in 2020 and UAE-Israel trade deal Two Israeli companies have joined Abu Dhabi Investment Office’s $545 million Innovation Programme, with industry watchers predicting that many more will follow as ties strengthen between the country and the UAE. ADIO is working with fintech company Liquidity Group to establish an R&D centre in Abu Dhabi. The facility will develop Liquidity’s proprietary underwriting algorithm and other tech products. The Abu Dhabi office is also supporting OurCrowd, Israel’s most active venture investment firm, to expand its operations in the emirate. OurCrowd will open a new office and an artificial intelligence tech hub, expanding its team at Abu Dhabi Global Market (ADGM) to 60 people over the next four years. ‘Full support’ for Abu Dhabi biotech tie-up with IsraelArab youth’s negative stance on Israel challenges trade growthAbraham Accords: The $3bn trade deal that shocked the world Dorian Barak, co-founder of the UAE-Israel Business Council, told AGBI: “We’re delighted – and not surprised – to see Israeli companies begin to take part in the fintech ecosystem that has formed at ADGM.” He added: “We expect ADGM to attract many more growth-stage Israeli fintech firms. Incentives from an organisation such as ADIO will only accelerate the trend.” ADIO, which opened an office in Tel Aviv in 2021, said its partnerships with Liquidity and OurCrowd covered financial and non-financial incentives. The deal is another step forward for UAE-Israeli relations since the signing of the Abraham Accords in September 2020. The countries are on track to record $3 billion of bilateral trade this year, with more than 500 Israeli businesses now operating in and through the UAE. The relationship has been turbocharged by the signing of a free trade agreement in May. Under the deal, customs duties were eliminated on 96 percent of products, including food, agriculture, cosmetics, medical equipment and medicine. The agreement also covers regulation, customs, services and government procurement. The UAE-Israel comprehensive economic partnership agreement is expected to advance bilateral trade beyond $10 billion within five years and add $1.9 billion to the UAE’s GDP within the same period. Total UAE exports are expected to increase 0.5 percent by 2030. Fleur Hassan-Nahoum, the UAE-Israel Business Council’s co-founder and the deputy mayor of Jerusalem, said: “We expect an increasing number of Israelis to recognise the UAE as an ideal location to establish global operations with a reach far beyond the UAE. Bureaucracy is light, the country is largely tax-free, human talent is easy to access, and the UAE is the region’s premier transport, logistics and business hub.” Abdullah Bin Zayed Al Nahyan, Benjamin Netanyahu, Abdullatif Bin Rashid Al Zayani and Donald Trump at the signing of the Abraham Accords in 2020. The UAE and Israel have since agreed a free trade deal. Picture: Official White House Photo/Andrea Hanks Announcing the fintech partnerships, Abdulla Abdul Aziz Al Shamsi, acting director-general of ADIO, said: “Liquidity Group makes a strong addition to Abu Dhabi’s financial services ecosystem, bringing its robust expertise in machine learning to grow the venture financing landscape. “OurCrowd is a great example of a company that has benefited from Abu Dhabi’s enabling ecosystem to achieve accelerated growth. In just a year, OurCrowd has moved from an initial licence to an established market player.” Founded in 2018, Liquidity is a technology firm that has become the industry’s fastest-growing lender to mid-market, late-stage companies by automating the debt lending cycle. Ron Daniel, CEO of Liquidity, said: “Thanks to our partners at ADIO, our new R&D centre in ADGM is growing fast and is swiftly being populated with some of the best global brains. We look forward to extending our partnership with ADIO to benefit all UAE tech.” OurCrowd Arabia will launch its AI facility, Integrated Data Intelligence, at ADGM’s Hub71. Jon Medved, founder and CEO of OurCrowd, said: “Following a global search for the most suitable location for IDI and OurCrowd’s new investment centre, Abu Dhabi was by far the most fitting destination.” ADGM representatives formed part of an official UAE delegation that visited Tel Aviv in September. During the trip, three memoranda of understanding were signed to explore and enable business opportunities in the financial world. At the time, ADGM chairman Ahmed Jasim Al Zaabi said the visit was a “testament to the long-term commitment of Abu Dhabi to foster stronger ties between the two nations”. The UAE-Israel relationship has been transformed in recent years. For decades after Israel’s founding in 1948, Gulf countries including the Emirates shunned the Jewish state in solidarity with the Palestinian cause. The signing of the accords marked the first public normalisation of relations between an Arab country and Israel since Jordan in 1994. Amir Hayek, the first Israeli ambassador to the UAE, who took up the post in October 2021, said bilateral trade increased by 117 percent during the first half of 2022, compared to the same period last year. He predicted that the UAE would be among Israel’s top 10 trading partners within the next three years.