Daily Times

China’s main interests in Israel are advanced technologies and Israel’s strategic location. As a developing nation, China has a lot of domestic challenges—pollution, desertification, an aging population, etc. Israel is a global powerhouse in technologies and innovation and can help China solve these problems. China is particularly interested in Israel’s expertise in biotech, water tech, environmental tech, agricultural tech, IT, energy, and health care, among others. China is eyeing Israel as an essential node of the BRI, with Israel’s strategic location and easy access to the Mediterranean Sea.

When meeting with Prime Minister Netanyahu in Beijing in March 2017, President Xi Jinping proposed the two countries to “steadily advance major cooperative projects within the framework of jointly building the Silk Road Economic Belt and the 21st Century Maritime Silk Road.” He asserted that Israel would be “a perfect junior partner” to China’s economy and welcomed Chinese investment in Israel. The three bilateral agreements that the two countries signed during Netanyahu’s visit included one that would allow 20,000 Chinese workers to get work visas permitting them to work on Israeli construction sites.

It is hard to know the exact amount of Chinese investments in Israel. A November 2018 report by Israel-based IVC Research Center suggests China invested about US$1.5 billion in around 300 Israeli companies in the previous five years. Statistics from China’s Ministry of Commerce show that in 2017 alone, China’s investments in Israel reached US$4.1 billion, all were direct investments. According to the American Enterprise Institute, Chinese businesses invested a total of US$8.05 billion in Israel from 2005 to 2019.

During his second trip to China in March 2017, Netanyahu and Xi announced the establishment of “a comprehensive innovation partnership”—the only one of its kind that China has established with other countries

Compared with the U.S., China’s trade with and investment in Israel are small. The 1985 U.S.-Israel Free Trade Agreement was the first one signed by the U.S. Since then, trade between the two countries had increased ten-fold to US$49 billion in 2016. U.S. firms have been a big part of the Start-Up Nation story, with U.S. companies establishing two-thirds of the more than 300 foreign-invested research and development centers in Israel. Meanwhile, Israeli firms represent the second-largest source of foreign listings on the NASDAQ after China—and more than Indian, Japanese, and South Korean firms combined.

Israel’s interests in China are both economic and strategic. Israel recognized China as a complete market economy in November 2005. The two countries had initiated talks on free trade agreement in 2016 and its finalization is just around the corner as the seventh and final round of negotiations was held in 2020 despite heightened tensions between the U.S. and China and pressures from the U.S.

Economic cooperation with China brings tangible benefits to Israel, such as fine consumer products, local jobs generated by Chinese investments, growing tourists from China, upgraded infrastructure, penetration into the Chinese market for Israeli businesses, etc.

During his second trip to China in March 2017, Netanyahu and Xi announced the establishment of “a comprehensive innovation partnership”—the only one of its kind that China has established with other countries. To bolster Israel-China cooperation in several domains related to innovation, the two countries established the China-Israel Joint Committee on Innovation Cooperation in May 2014.

Bilateral cooperation at the academic, business, and cultural levels is quite dynamic. Israel maintains an embassy in Beijing and consulates in four other Chinese cities: Shanghai, Guangzhou, Chengdu, and Hong Kong—the second-largest number of its diplomatic missions overseas after the U.S., which has nine.

The Jiangsu-Israel Center, an innovation hub, was unveiled in Tel Aviv in September 2019 to host Israeli start-ups as well as Chinese companies interested in partnering with Israelis firms for innovative solutions. Israel already has a presence in Jiangsu Province, via the China Changzhou Israel Innovation Park, a bi-national governmental initiative inaugurated in 2015 that provides a platform for Israeli companies to enter the Chinese market. Some eighty Israeli companies operate there that cover fields including life sciences, modern agriculture, and new materials. Jiangsu is the first Chinese province that Israel established the innovation cooperation agreement, a model followed by nine other provinces and government ministries of China.

China and Israel have established joint research and education programs. By the end of 2018, at least six joint campuses and research institutions had been set up in China, including a specialized research center for Israel studies at Tongji University between Tongji University and Tel Aviv University, a joint research center between Tel Aviv University and Tsinghua University, a joint lab between the University of Haifa and East China Normal University, a joint center for entrepreneurship and innovation for Ben Gurion University of the Negev and Jilin University, a joint agricultural training center at China Agricultural University, and the Guangdong Technion-Israel Institute of Technology. SIGNAL, a think tank and academic organization based in Israel focusing on China-Israel relations, has brought Israel studies programs to over a dozen universities across China as of 2020

(To be concluded).

The writer can be reached at saudzafar5@gmail.com