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Israel Aerospace, Etihad to Open Aircraft Conversion Site in Abu Dhabi

Visitors watch a demonstration at the Israel Aerospace Industries (IAI) booth in the IMDEX Asia maritime defense exhibition in Singapore May 19, 2015. (Reuters)
Visitors watch a demonstration at the Israel Aerospace Industries (IAI) booth in the IMDEX Asia maritime defense exhibition in Singapore May 19, 2015. (Reuters)
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Israel Aerospace, Etihad to Open Aircraft Conversion Site in Abu Dhabi

Visitors watch a demonstration at the Israel Aerospace Industries (IAI) booth in the IMDEX Asia maritime defense exhibition in Singapore May 19, 2015. (Reuters)
Visitors watch a demonstration at the Israel Aerospace Industries (IAI) booth in the IMDEX Asia maritime defense exhibition in Singapore May 19, 2015. (Reuters)

Israel Aerospace Industries (IAI) said on Wednesday it signed an agreement with Etihad Engineering to establish a facility in Abu Dhabi that will convert Boeing 777-300ER passenger planes into cargo aircraft.

The new facility, which will operate as the company’s maintenance center in Abu Dhabi, aims to meet the growing demand for large cargo jets.

“Not only do we see the demand, but we view it as a greener, more profitable, highly innovative solution for our airline customers, and an excellent way to drive value for our business,” Tony Douglas, chief executive of Etihad Aviation Group, said in a statement.

Demand for cargo plane conversions has been on the rise with the increase in ecommerce and the decline in value of used planes during the COVID-19 pandemic.

State-owned IAI currently converts Boeing 737, 747 and 767 passenger aircraft for cargo use. It has said it is currently developing a conversion method for the Boeing 777 and expects to finish the licensing process in 2023.

The deal comes a year after Israel and the United Arab Emirates agreed to normalize relations under the US-sponsored Abraham Accords.

Over the past year, Israeli firms have forged a number of deals in the UAE.

In March, IAI said it would jointly develop an advanced drone defense system with the UAE’s state-owned weapons maker EDGE.

Yossi Melamed, head of IAI´s Aviation Group, said the latest deal adds a “significant tier to the relations between Israel and the Gulf States” and that “additional agreements with companies in the region will arrive, and they will economically benefit all sides involved.”

IAI already operates cargo conversion sites including an existing line at its headquarters at Ben Gurion International Airport near Tel Aviv.

Etihad Engineering is one of the largest commercial aircraft maintenance, repair and overhaul (MRO) services providers in the Middle East, and the center in Abu Dhabi will be the largest and most advanced in the Middle East, IAI said.

It noted the facility will be certified by the UAE Civil Aviation Authority, the US Federal Aviation Administration, and the European Aviation Safety Agency.

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South Korea Aims to Delay US Tariffs in Talks, Cooperate in Mutual Areas 

Finance Minister Choi Sang-mok, who serves concurrently as deputy prime minister for economic affairs, speaks during a meeting of economy-related ministers at the government complex in Seoul, South Korea, 11 April 2025. (EPA/Yonhap) 
Finance Minister Choi Sang-mok, who serves concurrently as deputy prime minister for economic affairs, speaks during a meeting of economy-related ministers at the government complex in Seoul, South Korea, 11 April 2025. (EPA/Yonhap) 
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South Korea Aims to Delay US Tariffs in Talks, Cooperate in Mutual Areas 

Finance Minister Choi Sang-mok, who serves concurrently as deputy prime minister for economic affairs, speaks during a meeting of economy-related ministers at the government complex in Seoul, South Korea, 11 April 2025. (EPA/Yonhap) 
Finance Minister Choi Sang-mok, who serves concurrently as deputy prime minister for economic affairs, speaks during a meeting of economy-related ministers at the government complex in Seoul, South Korea, 11 April 2025. (EPA/Yonhap) 

South Korea will seek to delay the implementation of tariffs as long as possible in negotiations with the United States, its finance minister said on Tuesday, as Seoul targets cooperation in areas of mutual interest such as shipbuilding and energy.

Officials in Seoul have been scrambling to limit the damage to the export-reliant economy from the threat of looming duties.

South Korea is among the countries that US Treasury Secretary Scott Bessent has said Washington would sit down with to discuss the tariffs imposed by US President Donald Trump.

The priority was to delay the tariffs "as much as possible" to help reduce the uncertainty the country's businesses face in the global market, South Korea's Finance Minister Choi Sang-mok told parliament.

"From our national interest perspective, the idea is to negotiate as much as possible and wrap it up under the new government," he said in answer to a lawmaker's question about the direction of Seoul's response.

Trump hit Asia's fourth-largest economy with 25% "reciprocal" tariffs earlier this month as he targeted dozens of countries with import duties as high as 49%. He has since paused their implementation by 90 days but has maintained a 10% blanket tariff on all goods imports and ratcheted up levies on China.

The tariff shock comes as South Korea prepares to pick a new president in a snap election on June 3 after Yoon Suk Yeol was ousted this month over his short-lived martial law declaration.

While the power vacuum has raised questions about the mandate of acting President Han Duck-soo and the direction of its response to Trump's sweeping tariffs, Han's government has engaged with top US administration officials.

Han spoke to Trump last week in a phone call, while South Korea's top trade envoy met US Trade Representative Jamieson Greer to discuss lowering tariffs.

Trade and Industry Minister Ahn Duk-geun may travel to Washington next week for further talks, media reports said.

Choi said discussions between Trump and Han touched on the spirit of reaching a solution that meets the allies' mutual interests and includes cooperation in the shipbuilding sector and potential involvement in an Alaska gas pipeline project.

Seoul has previously indicated it was open to possible involvement in the gas project and that potential cooperation with Washington in the shipbuilding sector was a "very important card" in negotiations.

Trump's delay to some tariffs means the work of negotiating a trade arrangement to address the US president's claim of unfair trade will fall on a new South Korean president, who will take office immediately after the June 3 vote.

The tariff pause does not apply to the 25% duty that Trump imposed on steel and aluminium as well as vehicles.

South Korea is a leading global exporter of cars and steel to the United States.

Seoul announced on Tuesday an increase in its support package for its key semiconductor industry to 33 trillion won ($23.25 billion), amid growing policy uncertainty over US policies.

Trump said on Sunday he would be announcing the tariff rate on imported semiconductors over the next week, adding that there would be flexibility with some companies in the sector.