Here are some excerpts from Swedenborg's "Arcana Coelestia" that help explain the inner meaning of this chapter:

AC 1985. The subject here treated of is the union of the Lord’s Divine Essence with the Human Essence, and of the Human Essence with the Divine Essence; and also the conjunction of the Lord, through the Human Essence, with the human race.

AC 1986. Jehovah was manifested to the Lord in His Human (verse 1). Foretelling the union (verses 2, 3); namely, of the Divine with the Human, and of the Human with the Divine (verses 4, 5). And that all good and truth is from Him (verse 6). The conjunction of the Divine with the human race would thus be effected through Him (verse 7). And the heavenly kingdom would be His, which He would give to those who should have faith in Him (verses 8, 9). But man must first remove his loves and their foul cupidities, and so be purified; this is what was represented and is signified by circumcision (verses 10, 11). Thus conjunction would be effected, both with those who are within the church, and with those who are without it (verse 12).

[2] Purification must by all means precede; otherwise there is no conjunction, but condemnation; and yet after all the conjunction cannot take place except in man‘s impurity (verses 13, 14). The union of the Human Essence with the Divine Essence, or of truth with good, is foretold (verses 15 to 17). Also conjunction with those who are in the truths of faith, namely, as with those who are of the celestial church, so with those who are of the spiritual church (verses 18, 19). And that the latter also would be imbued with the goods of faith (verse 20). In conclusion, these things will be effected through the union in the Lord of the Human Essence with the Divine Essence (verse 21). The end of the prediction (verse 22). It was so to be done, and it was so done (verses 23 to 27).

1889. It is similar in this chapter with the names Abram, Sarai, Hagar, and Ishmael. What these include within themselves becomes clear from the Contents and after that from the explanation of each name in what follows. They are however things such as cannot be explained easily and intelligibly, for the subject covered by those names is the Lord's Rational - how it was conceived and born, and the nature of it before it had been united to the Lord's Internal, which was Jehovah. The reason this cannot be explained easily and intelligibly is that people at the present day do not know what the internal man is, what the interior man is, or what the exterior man is. When one speaks of the rational or of the rational man some idea can be formed of these, but when one speaks of the rational as that which lies between the internal and the external, few if any can grasp it. Nevertheless since the subject in the internal sense of this chapter is the way in which the Lord's Rational Man was conceived and born from an influx of the Internal Man into the External Man - for this is the subject embodied within the historical descriptions involving Abram, Hagar, and Ishmael and yet to prevent the ideas presented in the explanation that follows from becoming utterly strange and unintelligible, let it be recognized that with everyone there exists an internal man, there exists a rational man which is situated in between, and there exists an external man, and that these three are quite distinct and separate from one another. For these matters see what has been stated already in 978.