Israel and Bahrain sign agreement establishing diplomatic relations

The state of play: Treasury Secretary Steven Mnuchin and White House envoy Avi Berkowitz were in attendance at the signing alongside Bahrain's foreign minister and Israel's national security adviser.

• Mnuchin and Berkowitz arrived in Manama together with an Israeli delegation on the first direct flight of an Israeli airliner to Bahrain — El Al Flight 973, a reference to Bahrain's telephone code.
• Israeli and Bahraini officials held talks for several hours and inked eight memorandums of understanding (MOU) on visas, trade, agriculture, investments, direct flights, finance and investments.
• Mnuchin stood by as officials signed the MOUs alongside the agreement on diplomatic relations.

What they're saying: "Today is just a first step for Israel, Bahrain and the U.S. and an important step for strengthening stability in the region. We have a big opportunity in security, in trade, in travel and in many other fields," Mnuchin said.

What's next: Minutes after the signing ceremony, a senior Israeli Foreign Ministry official handed the Bahraini foreign minister a diplomatic note with a formal request for opening an Israeli embassy in Manama. Israeli officials told me they want to open the new embassy before the end of the year.

Sign up for my brand new weekly newsletter, Axios from Tel Aviv.