Dubai, Jun 1 (IANS): Israel and the United Arab Emirates (UAE) have signed a free trade agreement, the first of its kind between Israel and an Arab country.

The trade deal, signed by Israeli Economy Minister Orna Barbivay and her UAE counterpart Abdulla Bin Touq Al-Marri in Dubai, is expected to eliminate tariffs on 96 per cent of products, including food, agriculture, cosmetics, medical equipment and medicines, said the Israeli Economy Ministry in a statement on Tuesday.

The agreement also covers regulation, government procurement, e-commerce and intellectual property, it added.

Trade between Israel and the UAE reached $1.22 billion in 2021, and already $672 million in the first four months of 2022, according to Israel's Central Bureau of Statistics.

The bilateral trade mainly includes diamonds, automation and electrical equipment, electronics, vehicles, jewellery, minerals and oil, Xinhua news agency reported.

The Israel-UAE trade deal aims to help raise the annual bilateral trade to more than $10 billion in five years, according to both Israeli and the UAE ministries.

"The comprehensive economic partnership agreement will create a new model for constructive cooperation between the countries of the region," UAE's Abdulla Bin Touq Al-Marri was quoted as saying in a statement issued by his Ministry.

For her part, Barbivay said the deal "is expected to strengthen trade between the two countries, remove barriers and promote new opportunities and business partnerships, which will form a solid basis for our common path".

Israel and the UAE, which signed a historic normalisation agreement in September 2020, launched the free trade negotiations in November 2021.