Recently, the Chinese government expressed interest in investing in a new Israeli consortium developing the offshore oil fields near Haifa. This would add to the growing presence of China in Israel’s economy, which included the Carmel Tunnel and the Tel Aviv Light-Rail Project. China’s Yifang recently acquired Israel’s Pegasus Technologies. China is definitely interested in increasing its economic namely energy ties with Israel.
And that is precisely why they should be withheld.
More and more, the Chinese government has publicly come out against renewed sanctions against Iran. Further, Beijing has attacked the US for publicly attacking internet censorship in Iran. Compound these facts with Chinese support for North Korea and we are presented with an intolerable link with the Syria’s destroyed nuclear installation, attacked with a swift air strike in September 2007. All of these positions run counter to Jerusalem’s interests and should be grounds for Israeli sanctions against Beijing.
The military trade has been under pressure to be cut off for years, and this would provide Israel with the optimal excuse to make that gesture. Among numerous examples, the Bush Administration pressured and torpedoed a $1 billion deal that would have seen Israel upgrade Chinese jets and radars. There was diplomatic damage done from the abrupt deal breaker, but it is a move worth emulating, even at a time where Israel’s government is resolved to challenge US pressure on Israeli policy. China has benefited from the military trade with Israel, roughly totaling $1.5 billion during the 1990s, and currently covers work on surface-to-air missiles and unmanned aerial vehicles (UAVs).
As part of a greater effort to either persuade or pressure the Chinese into supporting a stronger sanctions regime against Tehran, Israel should show signs it will strengthen its relationship with Japan at China’s expense. It is also would not outside Israel’s periphery to cooperate with American-Taiwanese arms deals, like the clandestine Israeli transfer of American missiles to Taiwan in the 1980s.
Aside from the military imports, Chinese exports to Israel represent about $3.17 billion according to the Israeli Embassy to China. China itself recognizes the need to wean itself off oil and gas investments in places like Iran, even if only for the sake of diversifying its economy and improving its R&D sector, something it ought to be willing to make diplomatic concessions on in order to do. Even the mere threat that exports to Israel could be cut off would be a sure sign that China cannot reap benefits from both Israel and Iran simultaneously.
According to Tel Aviv University’s Aron Shai (link, p.27): ), expert on Israeli-Chinese relations, there is much that Israel still has to offer China in terms of agriculture and energy, something in which China has a commanding interest. Those facts point directly to Israel’s revolutionary desalinization technology and solar power markets. Limited access to advanced agro-techology and energy alternatives would certainly threaten China’s pace of growth.
It would certainly be preferable to open more economic missions in China, given the size of the market and tremendous demand for Israeli R&D. But given China’s obstinance on Israel’s priority security issue, such long-term investments should be off the table.