View / Economic integration key to cementing Middle East peace

Sometimes it’s easy to forget that today’s staunch allies were once bitter foes: The US and Japan. Germany and France. Today, US President Donald Trump seeks to create similar ties between Israel and its Middle East neighbors. Diplomacy will lead the way, but it is only through business and economic ties that we will achieve in the Middle East what the Marshall Plan did for postwar Europe.

“The Middle East is finally ready to embrace its extraordinary potential,” Trump told the Knesset in October. “We’re going to build a legacy that all the people of this region can be proud of. New bonds of friendship, cooperation, and commerce.”

The key to securing Trump’s vision — a hope shared by Israelis and many others throughout the region — is business. Israel’s experience of cold peace with its neighbors Jordan and Egypt show that diplomatic treaties don’t create harmony and prosperity. Commerce and investment will help the people of the Middle East create the personal and constructive relationships that come from solving shared problems and increasing mutual prosperity.

America has done this before. After World War II, the historic decision by the US to reinvigorate the economies shattered by decades of war through the Marshall Plan helped rebuild the continent and forge enduring alliances. From 1948 to 1952, the US provided more than $13 billion of economic aid to more than a dozen European countries, and more than $2 billion to Japan.

Germany and France fought centuries of bloody wars before becoming the bedrock of the European Union. The bitter US-Japanese war, including the decision to drop atom bombs on Hiroshima and Nagasaki, might have soured relations forever. Today, the US-Japan alliance underpins the security of Asia, generating billions of dollars in bilateral trade and tourism, amid deep friendship.

History also shows what happens when economic opportunities are squandered. When Israel withdrew from Gaza in 2005, it left behind extensive infrastructure for agricultural greenhouses and hydroponic farming that grew lettuce, tomatoes, flowers, and other crops with large sales in Israel. Donors purchased the greenhouses for $14 million and donated them to Palestinian farmers, but the initiative led nowhere. It was an early sign that Israel’s withdrawal wouldn’t lead to the peaceful coexistence so many had hoped for.

Many in the region recognize the benefits of partnering with Israel, which has demonstrated that despite its small size of just 10 million people, it has become an economic and technological powerhouse. Despite two years of war, the economy is growing. The stock market is outperforming most other developed market indexes, the currency is strong, and merger and acquisition activity this year soared to $71 billion. GDP per capita has nearly tripled since 2000 to more than $55,000, 70% of that in the US, while Saudi Arabia’s is a third of the US, roughly the same as it was 25 years ago.

This prosperity has moved beyond its borders, but not to its neighbors. A new report shows that 648 Israeli-founded businesses boosted New York’s economy by $13.3 billion in 2024, helping to create more than 57,000 jobs. In Florida, 429 Israeli-founded companies contributed $3.5 billion to the state’s economy.

When I visited Riyadh as the first Israeli venture capitalist invited to address the Future Investment Initiative a few years ago, young Saudi business leaders spoke enthusiastically of future partnerships with Israeli firms to address urgent needs in agriculture, weather prediction, water recycling, medical robotics, and protecting coral reefs against toxic algae. In Indonesia, another major Muslim country expected to embrace the Abraham Accords, we discussed early detection and suppression of rainforest fires, and expanding local agriculture.

There are tremendous opportunities to cooperate, to expand trade routes and tech partnerships. I foresee Salic, Public Investment Fund’s agricultural vertical, establishing strategic relationships with the Israeli pioneers who led the world in such areas as drip irrigation, hydroponics and cloud-based digital farm management system for precision agriculture.

“All the families of the earth will be blessed using you as an example,” God tells Abraham in Genesis 12:3. With the aptly named Abraham Accords bringing together all his children, many of us in the region hope this blessing will continue and expand.

Jon Medved is the founder and chairman of OurCrowd, a venture investment platform based in Jerusalem.