US calls on Israel to limit technology cooperation with China

By Arie Egozi

The US urges Israel to take further steps in order to avoid the flow of Israeli advanced defence and cyber technologies to China. The demand will be submitted to the new Israeli government when it is formed in the coming weeks.

In remarks made on Thursday at a conference organized by the Sino-Israel Global Network and Academic Leadership, US Deputy Assistant Secretary of State for Global China Issues Dr. Jung H. Pak urged Israel to do more to safeguard its technology and research from the dangers of Chinese involvement and investment

“Israel has begun the process of reviewing investments”, Pak stated over a video hookup. “That is a solid beginning step. More action is what we would like to see”.

In early 2022 the US administration has increased its campaign against the involvement of Chinese companies in infrastructure programs in Israel. That resulted some days ago with the disqualification of Chinese companies that made proposals for the construction of two lines of the light train project in central Israel.

Israeli sources said that the US pressure this time was “heavy” based on the fact that the planned railway lines are being built in the “close vicinity” of some Israeli defense sites working with the U.S. and what is defined as “critical communication lines.”

Nadav Argaman Former head of the Israeli internal security service (Shin Bet) said in a lecture that was reported by the Israeli media, that Chinese investments in Israel could put state security at risk.

According to the report, during a speech at the Tel Aviv University, Argaman said that legislation was needed so these investments could be supervised, citing Chinese interests in infrastructure projects like the new Haifa port and the Dan Region light rail, and their involvement in large Israeli companies.

For example, in May 2020, a few days before a decision was made on the Sorek 2 desalination plant, then U.S. Secretary of State Mike Pompeo arrived in Israel and warned against Chinese investments in critical infrastructure. In the end, a non-Chinese competitor won the tender, due to price considerations according to government sources.

According to a paper written by Doron Ella a researcher in the Israeli Institute for National Security studies (INSS) China is no doubt aware that Israel is under American pressure to reduce the involvement of Chinese companies in its economy. Therefore, it is possible that China decided not to submit bids for certain tenders, or refrained from making deals, that from its perspective could be thwarted by US opposition. For example, in May 2020, a few days before a decision was made on the Sorek 2 desalination plant, U.S. Secretary of State Mike Pompeo arrived in Israel and warned against Chinese investments in critical infrastructure. In the end, a non-Chinese competitor won the tender, due to price considerations according to government sources.

“The nature and scale of Chinese investments in Israel have indeed raised concerns in the U.S., as they are often in technological sectors the U.S. views as critical to its national security – e.g., computer chips and semiconductors, IT and software, life sciences (especially medical technologies), internet and communications technologies; these all have the potential to contribute to China’s future development, including in the military sphere, and to strengthen it in terms of technological competition against the U.S.”

The researcher writes that China has begun applying for tenders in the water and electricity sectors as well, so far with partial success.

“America’s concern in this context is the translation of China’s investments into influence and strategic access, and the creation of growing Israeli dependence on Chinese companies building upgrading, and operating Israeli infrastructure facilities, some of which are in security-sensitive areas.”

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