JERUSALEM: The agreement between Israel and the United Arab Emirates to normalize ties would kill the two-state solution, strengthen "extremists" and undermine the "possibility of peace", chief Palestinian negotiator Saeb Erekat said. The fractured Palestinian leadership-from the Palestinian Authority led by Mahmud Abbas in the occupied West Bank to Hamas Islamists in the Gaza Strip-was united in its opposition to the UAE-Israel deal announced Thursday by US President Donald Trump. "I really believe that this step is a killer to the two-state solution," Erekat said.

He argued that Israeli Prime Minister Benjamin Netanyahu will have less incentive to compromise on a viable Palestinian state "if he believes that Arab countries will line up to make peace with him". In a conference call with foreign reporters, Erekat said that "people like Netanyahu and extremists in Israel believe that the two-state solution is off the table". Meanwhile, "extremists on my side are (saying), 'we told you so from the beginning: the two state solution is off the table'," he added. Erekat condemned the agreement as a "desperate attempt" by Trump to notch a foreign policy success.

He further dismissed senior White House advisor and Trump's son-in-law Jared Kushner, an architect of the UAE-Israel pact, as displaying "a combination of arrogance and ignorance". Netanyahu said Sunday that the agreement upended the notion that "no Arab state would agree to open peace with Israel, before the conflict with the Palestinians would be resolved". "That mistaken notion gave the Palestinians de-facto veto power over peacemaking between Israel and Arab states and held Israel and the Arab world hostage to the most extreme Palestinian demands," Netanyahu said during his Sunday cabinet meeting.

According to a joint US, Israel, UAE statement, the Jewish state has agreed to "suspend" its plans to annex settlements and other territory in the occupied West Bank. Those annexations plans were outlined in Trump's Middle East peace proposal, unveiled in January. Netanyahu has said he remains committed to West Bank annexations, but agreed to hold for now, as part of his pledge to Trump. The Palestinians have called for emergency meetings of the Arab League and the Organisation of the Islamic Cooperation to reject the Israel-UAE deal, but have not received replies from either body, Erekat said.

The top Palestinian negotiator also said he had written to Saudi Arabia and Bahrain to ask them to pressure the UAE to cancel the agreement. "I have received an answer from the Saudi foreign minister reassuring me that Saudi Arabia's position is for a comprehensive peace agreement based on a two-state solution," Erekat said, noting Bahrain "did not answer me yet". Regional heavyweight Saudi Arabia has been conspicuously silent on the deal with no official reaction emerging from Riyadh.

Covert ties under focus
Meanwhile, UAE's decision to normalize ties with Israel could propel Saudi Arabia to deepen its furtive relations with the Jewish state as Riyadh seeks to entice investments to fund an ambitious economic transformation, analysts say. The United Arab Emirates on Thursday became the first Gulf state to normalize relations with Israel, in a historic US-brokered accord that raised the prospect of similar deals with other Arab states. Saudi Arabia, the Arab world's biggest economy, has maintained a conspicuous silence over the deal, but local officials have hinted that Riyadh is unlikely to immediately follow in the footsteps of its principle regional ally.

However, "the UAE-Israeli normalization lends itself to expanding the realm of indirect Saudi-Israeli relations," said Aziz Alghashian, a lecturer at Essex University specializing in the kingdom's policy towards Israel. "I think Saudi-Israeli interactions will increase via the UAE." Home to Islam's holiest sites, Saudi Arabia would face sensitive political calculations before a formal recognition of the Jewish state. Like the UAE's move, such a step would be seen by Palestinians and their supporters as a betrayal of their cause.

But the kingdom has already cultivated covert ties with Israel in recent years, a shift spearheaded by Crown Prince Mohammed bin Salman even as his father King Salman has voiced steadfast support for an independent Palestinian state. A shared animosity towards Iran, along with Saudi attempts to attract foreign investment to fund Prince Mohammed's ambitious Vision 2030 economic diversification plan, appear to be pushing the kingdom closer to Israel than ever.

A centerpiece of Vision 2030 is NEOM, a $500 billion planned megacity on the kingdom's west coast, for which observers say the kingdom requires Israeli expertise in areas including manufacturing, biotechnology and cyber security. The creation of NEOM "requires peace and coordination with Israel, especially if the city is to have a chance of becoming a tourist attraction," said Mohammad Yaghi, a research fellow at Germany's Konrad Adenauer Stiftung. NEOM is set to be built close to the Israeli resort town of Eilat, along the geopolitically sensitive waters of the Red Sea and the Gulf of Aqaba.

'Integral part'
Gulf states have increasingly sought Israeli technology for the surveillance of their own citizens and to purchase precision missiles that Western countries are unwilling to sell, Yaghi wrote in a research paper in April. Saudi Arabia has sought to keep its outreach to Israel out of the public eye, but it has not been easy. In June, a verified Twitter account linked to the kingdom's embassy in Washington said the Saudi council of ministers had agreed to recruit Israeli cyber security firm Check Point Software in NEOM.

The embassy later denied the claim and distanced itself from the account. Marc Schneier, an American rabbi with close ties to the Gulf, quoted Saudi Arabia's deputy defence minister Prince Khalid bin Salman as once telling him that Israel was an "integral part" of achieving Vision 2030. Schneier made the comment to AFP in May, and Saudi authorities did not dispute that the prince made the remark. Despite the official silence, the pro-government Saudi media has repeatedly tested public reaction by publishing reports advocating closer ties with Israel.

"I forecast a future that entails the creation of a joint high-tech ecosystem among [Gulf Cooperation Council] countries, known as the 'Silicon Wadi'," Israeli consultant Nave Shachar wrote last week for the English website of Al-Arabiya, a Saudi-owned broadcaster. Shachar, who according to his LinkedIn profile was previously employed by the Israeli defense ministry, was referring to a regional equivalent of Silicon Valley. "Now, more than ever, it is in the best interest of Israel and the GCC to increase business cooperation," he said.

'An inevitability'
Observers say US President Donald Trump, who backed Prince Mohammed following global uproar over the 2018 murder of journalist Jamal Khashoggi, holds enormous leverage to get the kingdom to formally recognize Israel. But Saudi Arabia appears to be resisting Washington's pressure as it has more at stake than the UAE. "I do think it is an inevitability that Saudi Arabia and Israel will have fully normalized relations and they will be able to do a lot of great things together," said Jared Kushner, an advisor to Trump, said at the weekend.

"Saudi Arabia has obviously been a great leader in making (modernization) but you can't turn a battleship around overnight," Kushner told CNBC. Schneier said the kingdom's leadership held "conflicting views along generational lines." "This bold initiative by the Emirates will strengthen the generational forces that would like to see this happen now," he told AFP this week. "This announcement from the UAE will transform the current indirect relations between the Saudis and Israel to formal direct relations."- Agencies