Israel Aerospace Industries (IAI), one of Israel’s largest defense companies, has reportedly secured a supply agreement worth $1 billion with an unnamed “third party,” the company announced on Tuesday.
The substantial agreement is set to be delivered over five years and completed by 2029. Although IAI has not revealed specific details about the deal or the client, foreign media speculates that it involves the delivery of satellites to Morocco.
Morocco normalized its ties with Israel by signing the U.S.-brokered Abraham Accords in 2020. The country now reportedly seeks advanced satellites for espionage and communication radar purposes. IAI is said to be one of only ten defense companies worldwide capable of developing and manufacturing such satellites.
IAI’s Moroccan-born chairman, Amir Peretz, was reportedly seen boarding a flight bound for Morocco, increasing the likelihood of a significant deal, however, the IAI declined to comment.
An industry insider assessed that the ongoing conflicts worldwide fuel a high demand for military equipment.
“Global demand for military equipment of all kinds is at an all-time high. This is an arms race by the West in response to the emerging axis of evil threat,” the official said. “This is a golden era for Israeli defense industries because their equipment and technology have proven effective on the battlefield during the Gaza war.”
Since 2020, Morocco and Israel have developed close commercial and military ties, with Morocco showing a strong interest in Israeli military technology. In 2021, the two countries signed a historic defense agreement, paving the way for intelligence sharing and joint military exercises.
“It will allow the beginning of official security cooperation between the two [countries]. The agreement includes formalizing intelligence-sharing and will allow for ties between their defense industries, defense procurement and joint exercises,” the Israeli Ministry of Defense stated after then-Defense Minister Benny Gantz signed the agreement during a visit to Morocco.
In November 2021, Morocco also reportedly signaled interest in acquiring the advanced Israeli Iron Dome aerial defense system.
In May 2023, IAI and the International University of Rabat in Morocco signed a Memorandum of Understanding (MoU) concerning the construction of a research center in Morocco for artificial intelligence and aeronautics.
Peretz noted at the time that the new center could have a positive global impact.
“By establishing the necessary industrial infrastructure, it will be possible to recruit new graduate students. Looking into the students’ eyes, I can see their strong determination to succeed in this new center, bringing forth ideas which hopefully will serve not only Morocco and Israel, but also the entire world,” Peretz said.
Despite its small size, Israel has emerged as one of the world’s ten largest defense technology exporters, with defense exports reaching a record $12.5 billion, according to a 2023 report by the Israeli Ministry of Defense. The report highlighted a 50% increase in exports compared to the previous three years and a doubling of military export volume over the last decade. Around 25% of these exports went to new Arab Abraham Accords partners, including Morocco, the United Arab Emirates and Bahrain.