Needed more than ever: An Israel-China policy
The deepening of the US-Sino rivalry will surely intensify in a post-corona world
Remember a few months back – the coronavirus makes it now seem like ages ago – when there was massive US pressure on Israel regarding Chinese infrastructure investment in Israel, and how Washington warned Israel against allowing the Chinese to enlarge and manage Haifa Port?
Remember how, during an otherwise golden age in ties between Washington and Jerusalem, China was the main bone of contention between the two countries: Israel wanting to deepen and expand trade with China, and the US – in fierce global competition with China – increasingly worried about Israel’s relationship with the Asian superpower?
At that time, China was one of the main talking points in all senior meetings between US and Israeli officials. Largely to placate US concerns about Israel’s ties with China, the government in November created a mechanism to vet investments by foreign parties in strategic infrastructure in Israel. China was not mentioned in the decision, but it was clear to all what the primary target was.
Well, that will probably all seem like child’s play when the world emerges from the coronavirus and the Chinese-US rivalry gets deeper and much more bitter. The animosity is already being felt, with US President Donald Trump calling corona the “Chinese Virus,” and the Chinese countering by blaming the US military for its spread.
The deepening of the US-Sino rivalry will surely be one of the most significant new geopolitical features in a post-corona world, with China – in an apparent effort to strengthen itself diplomatically – already offering aid to other countries, noticeably Italy, to deal with the virus. What is striking is that this is happening at a time when the US is very much focused on the health crisis within its own borders and is not taking a wider leadership role – as some would have expected – in fighting the plague.
In a Zoom conference this week sponsored by the Jewish People Policy Institute (JPPI) on the triangular US-China-Israel relationship, Shalom Wald, a senior fellow at the JPPI who just published a policy paper on the issue, said that the post-corona rivalry between the US and China will be less about trade, and more about technological supremacy.
“The one who controls and runs advances in science and technology will control a lot of the future of the changing world,” he said.
And in that rivalry Israel – with its historic and critical alliance with the US, alongside its blossoming business relationship with China – is likely to be in the crosshairs.
“Israel is facing a dilemma it has never faced before,” Wald said. “Our greatest friend and indispensable ally, America, demands that we treat the second superpower almost as an enemy.”
As America’s ultimate ally, Israel – and other US allie – may be asked to take steps regarding China that go against their own national interests, but show clearly that thy are taking the “right side” in the new global superpower competition.
Israel’s links with the US – politically, militarily, economically, on Wall Street, in Silicon Valley, with the Jewish community – are “indispensable and existential,” Wald said. By contrast, he added, “our links with China are critical, growing, but not the same. They are not at the same level.”
Israel’s ties with China are important for trade – it is currently Israel’s second-largest trade partner – and that could grow, although more than 75% of Israel’s $5 billion in exports to China last year were from two companies: Intel and Israel Chemicals.
Ties with China are also important for infrastructure development, as there is no other country that can as effectively and rapidly help Israel build the infrastructure – roads, railways and ports – that it needs to remain economically competitive.
While much is known about the the problems involved in allowing the Chinese to build and manage Haifa Port – the US was furious, saying that it posed an intelligence risk to the US Sixth Fleet when it docks in Haifa – what is less known is that Israel first turned to the US when looking for firms to develop the port, but to no avail. Only after US firms showed no interest in the project did Israel turn to China.
Beyond trade and infrastructure, China is also important to Israel because it is entering the Middle East in a significant way, and Wald predicted that within 10 years it would likely have navy and army bases in the region.
China, he said, will be a force in the neighborhood, much as Russia is today, and “we don’t need to have this country considering us as an enemy because we treated it as an enemy. This is a major concern that should worry us in many ways.”
Israel is in a tragic paradox, he said. “The US pressure to limit links with China does not damage China, it damages Israel. China, without links with Israel, would do fine. If Israel would disappear from China, it would make no macro-economic difference in China. If China would disappear from Israel’s ties, we would suffer.”
MIKE HERZOG, a veteran of Israel’s security establishment and a JPPI fellow who took part in the conference, said US-China tension in the post-corona age will create dilemmas for America’s allies, including Israel and some European countries as well, who will be facing a major economic crisis.
It is likely, he said, China will offer investments, deals and a supportive hand in infrastructure projects to help countries recover economically from the plague.
“It will probably be there to extend its hand, and this will intensify the dilemmas for Israel and some other actors,” he said.
What that means, said Carrice Witte, the founder of Signal, the Sino-Israel Global Network & Academic Leadership, is that Israel needs a comprehensive plan on how to deal with China, and it needs that type of plan immediately.
“When the coronavirus crisis is over, the US will start putting pressure on everybody over everything having to do with China,” she said in an interview. “Israel needs a plan. Right now we don’t have one, and don’t have a framework to shape one. And the US is going to start coming down on us, and we will have nothing to say.”
Witte advised developing “a comprehensive, coordinated all-government approach to China, which engages the private sector, so it understands that if it works with the government, it will benefit in the long run because it will have more access to sell in China.” Currently many Israeli firms act independently in China.
According to Witte, this plan should include the following steps: “First, [Israel] has to understand the needs and concerns of China. Second, Israel needs to assess what will address those needs and concerns. Third, Israel needs a list of what it wants from China.
“All anyone ever says [when asked what Israel wants from China] is to change their vote at the UN. That is probably one of the least important things to ask for. How about asking them to contribute to stability in the Middle East? Ask them to stop direct flights over their territory between Iran and the DPRK [North Korea]. I don’t know how much leverage it would take for that, but we need to have it in order to even try.”
While the China-Israel relationship is asymmetrical, China does want things from Israel, and the idea is to use that as leverage to impact on Chinese actions in the region.
At the JPPI panel, Witte said that having a comprehensive plan regarding China would enable Israel to address the concerns the US has about the relationship. The plan needs to think through all the potential pitfalls – and take into account US concerns – so that when Washington comes with questions about the ties, Israel can say that it has done its homework and has answers, she said.
Jerusalem, Herzog said, needs to immediately start thinking about its post-corona relationship with China and the US, and it needs to start thinking about this even before the health crisis is over.
“It is time for Israel to strengthen its decision-making capabilities with more expertise on China, and with a designated Chinese bureau inside the Prime Minister’s Office,” he said.
“It is also time Israel enters into a deep dialogue with the US in order to better clarify what is acceptable and not acceptable in Israel dealing with China, because not everything is clear regarding the US positions on these issues.”
What Israel needs, Herzog said, is “a policy.”