Executive Summary

Saudi Arabia is in the midst of an unprecedented economic revolution, through which it seeks to position itself as a regional technological and economic power. At the same time, the entire Middle East is undergoing a process of transformation in terms of the balance of power and regional arrangements, a process involving states seeking to establish a regional order characterized by cooperation and stability, including the United States and the pragmatic Sunni states: Jordan, Egypt, the United Arab Emirates, Bahrain, and Saudi Arabia.

The issue of normalization with Israel has not entirely fallen off the agenda of the Saudi leadership, even though the “Swords of Iron” war halted progress in that direction—which had reached an advanced stage on the eve of the October 7 offensive—and also led to a hardening of Riyadh ׳s public position toward Jerusalem following the outbreak of the war. At the same time, the joint campaign by Israel and the United States against Iran, Operation “Rising Lion,” sharpened the shared threat posed by Iran to the Gulf states and to Israel, and underscored the need for regional security and economic cooperation, including in the fields of infrastructure, trade corridors, and energy supply. In this context, the operation also demonstrated the central role of the United States in defending Saudi Arabia and the Gulf states, and reinforced their dependence on the U.S.—a fact that grants Washington significant leverage in promoting a regional settlement that includes normalization with Israel.

Under these circumstances, Israel stands before a strategic opportunity to expand the Abraham Accords, to integrate into regional economic and infrastructure projects, and even to deepen integration with those moderate states mentioned above, which aspire to security stability and regional economic prosperity.

This collection of articles examines the economic, infrastructure, and political opportunities and challenges involved in normalization between Israel and Saudi Arabia, and proposes courses of action towards establishing a sustainable regional partnership, which is essential for the integration of the State of Israel into the Middle East and for the expansion and deepening of the Abraham Accords. The argument emerging from these articles is that if ties are built, even in the absence of a comprehensive political framework, they will demonstrate the advantages of establishing formal relations and expanding cooperation, along with the expected mutual benefits, thereby increasing the motivation of Israel, Saudi Arabia, and additional states in the region to overcome the obstacles on the path to achieving it.

Economic and Strategic Potential

Normalization with Saudi Arabia holds significant economic potential for Israel. Over the past decade, the Saudi economy has undergone a profound transformation as part of “Vision 2030”—an ambitious national program designed to reduce the state ׳s dependence on oil, diversify the structure of its economy, and develop civilian sectors based on innovation, industry, and technology. Saudi Arabia is thus investing unprecedented sums in fields in which Israel holds leading technological advantages—high-tech, artificial intelligence, cyber, and security-related technology.

In this context, some have identified the potential for Israeli exports to Saudi Arabia amounting to billions of dollars annually, alongside the opening of channels for direct investments and joint ventures. For purposes of comparison, while the volume of Israel ׳s trade with the United Arab Emirates
grew more than tenfold within five years of their signing the Abraham Accords, surpassing three billion dollars, the scale of the Saudi economy points to the potential for even more significant trade, given that its GDP alone exceeds the combined GDP of all four states that signed the Accords. This potential could be realized through extensive trade and mutual investments, the opening of new land corridors linking the Arab Gulf to the Mediterranean Sea, and greater cooperation in the fields of high-tech, artificial intelligence, innovation, and security. Additional significant sectors include energy, climate, cyber, desert agriculture, water, food security, and tourism, particularly religious tourism. Saudi Arabia is investing unprecedented sums in these sectors, and Israel can offer proven technological solutions relevant to them.

Beyond the direct economic potential, normalization will enable Israel to integrate into emerging regional infrastructure initiatives, such as the IMEC (India–Middle East–Europe Economic Corridor) project—a transport, energy, and communications infrastructure route connecting India, the Middle East, and Europe. Saudi Arabia is a key player in this axis, and Israel, which possesses clear technological and geographic advantages, could potentially integrate into it, both as a logistical intermediary and as a technological partner. However, without some accommodation of the moderate Arab camp, which encourages stability and economic prosperity in the region through cooperation and requires Israel to advance political arrangements in the Israeli-Palestinian conflict, Israel may find itself outside this axis.

Key Recommendations Regarding Strategies for Expanding and Deepening the Abraham Accords, Including the Promotion of Normalization with Saudi Arabia

• Establishing a governmental body to coordinate government ministries, civil bodies, and relevant companies from the private sector towards regional cooperation and infrastructure connectivity (transport, energy, and communications) between Israel and its neighbors, backed by explicit government commitment and a dedicated budget.
• Strengthening and encouraging the private sector toward trilateral cooperation between Israeli and American companies in projects in Saudi Arabia, in line with the needs of Vision 2030, as a basis for creating shared economic interests that support normalization and further it over time.

• Focusing on sectors in which Israel holds a comparative advantage.

• Formulating an overarching Israeli strategy for regional corridors and IMEC, both at the infrastructural level and at the comprehensive political level.
• Advancing the Abraham Accords; achieving preferred status for Israel in core technological fields, while preserving the “Qualitative Military Edge” (QME) vis-à-vis the United States.
• Willingness to advance a political process in the Palestinian arena as an “entry ticket” to the new regional order.
• Investing in public diplomacy and building a cultural bridge to conservative Saudi society, in order to gradually establish legitimacy for normalization with Israel.