US President Donald Trump has hailed the "dawn of a new Middle East", as the United Arab Emirates (UAE) and Bahrain signed agreements to fully normalise relations with Israel.
The Gulf states are the fourth and fifth Arab countries to recognise and establish formal diplomatic relations with Israel, after Egypt, Jordan and Mauritania. The latter later severed ties with the occupation state as a result of its 2014 war on Gaza.
"After decades of division and conflict we mark the dawn of a new Middle East," Trump told a crowd of hundreds gathered yesterday at the White House.
"We're here this afternoon to change the course of history," he added.
The US president talked of how Israel and the two Arab states would establish embassies in each other's countries and co-operate on tourism, trade, health care and security. "They're going to work together," Trump said. "They are friends."
Israeli Prime Minister Benjamin Netanyahu described the day as a "pivot of history, a new dawn of peace."
He said: "For thousands of years the Jewish people have prayed for peace, for decades the Jewish state has prayed for peace, and this is why today we are filled with such profound gratitude."
UAE Foreign Minister Sheikh Abdullah Bin Zayed Al-Nahyan, said: "Today is a truly historic occasion. A moment for hope and opportunity. We are already witnessing a change in the heart of the Middle East, a change that will send hope around the world."
"We are witnessing today a new trend that will create a better path for the Middle East."
However, the deal falls short of any grand Middle East peace plan to resolve decades of conflict between Israel and the Palestinians despite Trump's pledge to do so with efforts led by White House adviser, his son-in-law Jared Kushner.
Trump proposed a 'peace plan' in January that heavily favoured the Israelis, but it has not advanced in any significant way.