What will the Middle East look like in 2040? One vision, shared by America’s allies, sees the cradle of civilization becoming the sandbox for tomorrow’s critical technologies. In this narrative, a U.S.-led economic corridor stretching from Delhi to the Mediterranean would enhance regional integr ation, and usher in a new era of shared prosperity. The alternative vision is already manifest in the growing collaboration between China, Russia, Iran and North Korea — the Axis of Disruptors. It expresses the path of continued regional instability, revanchist aggression, missed opportunities for human flourishing, and an uncontested expansion of the physical and digital infrastructure that underpins the Belt and Road Initiative — China’s model for exporting authoritarianism. If the former vision is to prevail, we need to start by defining the future of the ironclad strategic partnership between the U.S. and Israel — its strongest ally in the region. The ten year memorandum of understanding between the two countries — a core expression of Israel’s status as a major non-NATO ally — is up for renewal in 2028. While this agreement has been essential for Israel’s security, it must be updated to reflect a rapidly changing geopolitical landscape. The last memorandum was written before the artificial intelligence revolution, before the birth of the Abraham Accords, and before the tectonic shifts of the past two years, following Hamas’s Oct. 7, 2023 attack on Israel. At a global level, this geopolitical landscape is increasingly defined by innovation power. Whoever dominates the critical technologies race, from AI to 5G and microchip production, can wield global influence, project political and cultural values abroad, and benefit from economic and national security advantages. For America, its lead over China in certain critical technologies is closely contested. The shape of this competition will determine its ability to divide attention between competing demands in Europe, the Middle East and Asia. The unveiling of Deepseek’s AI models from China revealed just how razor-thin the margins of the competition are. To sustain innovation power, the U.S. needs to act together with its allies, with a renewed and intensified focus on joint technological development and supply chains, particularly in deep tech fields. For Israel, the established model of software and cyber driven innovation is not guaranteed to prevail in the age of AI. On the surface, Israel’s position in the tech competition looks strong for a country of only 9 million people and limited natural resources. The country has 131 companies listed on the NASDAQ, the fourth most companies after the U.S., Canada and China. But the conditions which propelled its outsized technological success relative to its population size and geography, earning it the moniker “Start-Up Nation,” are changing. Today, the startups which attract most funding in Israel tend to be concentrated in defense and cybersecurity. As AI reshapes industries globally, Israel must secure the resources, talent and research and development capabilities to remain competitive, and diversify into emerging technologies in AI, quantum, biotech and more. Competition in the neighborhood is evolving too. Gulf States such as Saudi Arabia and the United Arab Emirates — blessed with the space, capital and cheap energy that Israel does not possess — are investing heavily in AI infrastructure, aiming to transform their economies from oil to silicon. So what exactly does an updated U.S.-Israel partnership for the age of AI entail? We propose three main pillars of cooperation, one existing, and two new. First, security. In the last six decades, security cooperation has been central to formal agreements between the U.S. and Israel, and should be continued, including renewal of the security aid MOU signed between the countries in 2016. The fruits of that cooperation are significant, including the jointly developed missile defense systems integral to thwarting Iran’s unprecedented missile and drone attacks in 2024. It allowed Israel and its allies to defend the country in a multifront war with Iran’s proxies, from Hezbollah in Lebanon to the Houthis in Yemen. Security cooperation secures a qualitative military edge for both countries. It has helped U.S. troops deployed to the Middle East to fight the Islamic State and other terrorist groups. It will protect American lives in the future — especially by implementing AI in the battlefield — as a counterpoint to the growing cooperation between the Axis of Disruptors. The latter are increasingly sharing military technologies used to target Israel, Ukraine, America’s Gulf allies, global shipping in the Red Sea and even the U.S. itself. It also supports the U.S. defense industry, as Israel is obligated to spend U.S. security assistance funds in the U.S. In sum, this pillar should be renewed, solidifying the regional defense coalition which thwarted the Iran attacks, while applying targeted investments to build Israel’s defense production autonomy, and reduce its economic dependence on the U.S. as a benefactor. Second, we suggest a new, additional, memorandum of understanding focused on critical technologies establishing a bilateral partnership not only in defense but also in dual-use and civilian technologies — AI, quantum computing, biotech, food security and energy security — identified in the U.S.-Israel Strategic Dialogue in 2022. A government-to-government joint venture to significantly increase funding for bilateral programs is vital for joint research in these technologies, as well as enhanced collaboration between universities and research institutions. Israel — like other U.S. allies — possesses world class researchers but lacks access to research facilities to scale and commercialize new ventures. U.S. taxpayers, companies and national innovation power would also benefit from more joint research and development projects, shared intellectual property, investment, commercialization and workforce development initiatives within Israel’s dynamic tech ecosystem. Any critical technology cooperation should of course include provisions to protect unintended knowledge transfer to China. Finally, any new memorandum should strengthen and expand the regional multilateral agreements — including the Abraham Accords — as a counterpoint to the influence of the Axis. A vital part of this effort is the need to create mechanisms for tech cooperation on the challenges specific to the region, such as food and water security, AI infrastructure growth and renewable energy. As the U.S. and Israel renew their partnership in a new Middle East, the future of innovation, regional security and global diplomacy rests on their shared commitment to shaping the technologies that will define the 21st century. Ylli Bajraktari is the president of the Special Competitive Studies Project. Amos Yadlin is founder and president of MIND Israel. He is a retired major general in the Israeli Air Force and served as the head of Israel’s Defense Intelligence. Avner Golov is vice president of MIND Israel. He was a senior director on Israel’s National Security Council. ...read more read less