Biden Administration Increases Pressure on Israel for Cracking Down on China

Biden Administration Increases Pressure on Israel for Cracking Down on China

This week, Eyal Hulala, the National Security Advisor from Israel visited Washington, where he spoke with officials from the Biden administration. They discussed the threats associated with Chinese investments in hi-tech and major infrastructure in Israel. The American officials urged the security advisor to come up with a more robust system for screening foreign investments. Senior defense officials in Israel have also suggested that a new committee be established by Prime Minister Naftali Bennett for overseeing foreign investments in the country, taking into account the numerous bids China has made on their technology and infrastructure.

The officials recommended that the Prime Minister himself lead the new committee and replace an existing one that is overseen by the Finance Ministry. However, it is a voluntary one and doesn’t focus on the core areas that have attracted Chinese investments. No decision has been made in this regard by the Prime Minister’s Office. But, the government has continued to stall the announcement of the winner of the tender for building the new Green and Purple Lines of Light Rail’s in Tel Aviv. The construction and design of the transit system is the responsibility of the government-funded firm named the NTA Metropolitan Mass Transit System, but it has been dragging its feet in making a decision. 

The largest transit company in Israel, Egged had made an announcement earlier this week about the winner of a tender of buying 200 electric buses. Three companies had emerged as the winners and they would be supplying buses manufactured in China. The suggestion of establishing the new committee has come from officials that include top officers in the Israel Security Agency known as Shin Bet and IDF. They are greatly concerned about the possible consequences of the continued penetration of Chinese companies in the country’s economy. 

The first prominent concern is that if Chinese companies continue to win tenders and make contributions to their infrastructure, the country’s ties will Washington will suffer due to the tensions between China and the US. The second concern is that the infrastructure can be exploited by China for espionage activities against and inside Israel. The Tel Aviv Light Rail tender winner had originally been scheduled for an announcement in June. Chinese companies make up most of the groups that are competing for this multi-billion dollar deal. 

Even though the government has officially said that it hasn’t opened the envelopes for reviewing the bids, a source revealed that the government had gotten in touch with one of the groups to ask them why their prices were lower as opposed to the others. China Railway Construction company is one of them. China Civil Engineering Corp. is one of its subsidiaries and in 2014, it had dug the Gilon Tunnel for $200 million and worked on the Carmel Tunnel project as a subcontractor for $150 million. For the last few years, it has been working on the Red Line of the Tel Aviv Light Rail system for $500 million. In June, an executive order had been issued by US President Joe Biden that banned these companies from getting any investment. 

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