Netanyahu says bet on Israel and Saudi Arabia deepening ties

Jerusalem: Israel and Saudi Arabia will deepen economic and business relations even if they don’t formally recognise each other, according to Benjamin Netanyahu.

The Israeli prime minister told Bloomberg he’s confident he can strike a deal with the Saudis under which the countries will have official diplomatic ties. Without one, the two can still build an “economic corridor” running from the Arabian Peninsula to Europe that encompasses energy, transport and communications technology, he said.

“We’re going to realize that,” he said in a television interview on Sunday in Jerusalem. “My sense is we’ll realise that whether we have formal peace or not.”

It’s unclear if Saudi Arabia would accept much deeper connections. Public opinion in the kingdom remains opposed to recognition of Israel.

Netanyahu, 73, has frequently said the normalisation of ties would benefit Israel and Saudi Arabia economically and discourage Iran from meddling aggressively in the region, including by disrupting oil-shipping routes.

While Saudi Arabia and Iran restored diplomatic relations earlier this year in a deal that China helped broker, Riyadh still views Tehran with suspicion and as a geopolitical rival.

US President Joe Biden is also keen for Saudi Arabia to recognise Israel. He sent National Security Adviser Jake Sullivan to the kingdom last month, partly to discuss the issue with Crown Prince Mohammed bin Salman.

It would have “enormous economic consequences for investors,” Netanyahu said. “If they had to bet on it, right now I’d bet on it. But I can’t guarantee it.”

Check box

Riyadh has previously said an independent Palestinian state is a precondition. It has expressed frustration in recent months over Israel’s deteriorating relations with the Palestinians — typified by the recent raid on a refugee camp in the West Bank and incendiary comments by some far-right members of Netanyahu’s coalition.

Netanyahu downplayed the Palestinian issue as something hindering a Saudi-Israel deal.

“It’s sort of a check box,” he said. “You have to check it to say you’re doing it. Is that what’s being said in corridors? Is that what’s being said in discreet negotiations? The answer is a lot less than you think.”

The premier declined to say if he would accept limitations on new Jewish settlement in the West Bank to get an agreement with Riyadh. He said he wouldn’t allow a Palestinian state without Israel having security control over it.

“You won’t have a Palestinian state — you’ll have an Iranian terror state,” he said. “The Palestinians should have all the powers to govern themselves and none of the powers to threaten Israel. This means that in whatever final peace settlement we have with the Palestinians, Israel has the overriding security power in the entire area “- ours and theirs.”

Normalisation would be a significant coup for Israel. While it’s signed historic diplomatic deals with the United Arab Emirates, Bahrain, Morocco and Sudan since 2020, Saudi Arabia is the biggest economy in the Middle East, with the government investing trillions of dollars to diversify from oil.

Despite the lack of formal ties, Israeli tech and cyber-security firms have secretly done business with the kingdom for years. In late 2020, Israeli media said Netanyahu had flown to Saudi Arabia to meet the crown prince, a trip that was never officially acknowledged by either side.

Some dealings have become more open. Last year, Saudi Arabia opened its airspace to airlines flying in and out of Israel. And this month SolarEdge Technologies Inc., an S&P 500 company based in Israel, announced it’s forming a joint venture with a Saudi firm to develop renewable energy in the kingdom.