by Yaakov Katz, Lahav Harkov
Defense officials call on Bennett to head new panel to screen Beijing’s investments in Israel as gov’t stalls on rail tenders.
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PRIME MINISTER Naftali Bennett and US President Joe Biden chat in the Oval Office last week.
(photo credit: JONATHAN ERNST / REUTERS)
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Biden administration officials spoke with National Security Advisor Eyal Hulata
about the threats posed by Chinese investments in major infrastructure
and hi-tech in Israel when he visited Washington this week.
The American officials encouraged Israel to establish a more robust screening system for foreign investments.
Senior
Israeli defense officials have also recommended that Prime Minister
Naftali Bennett establish a new committee to oversee foreign investments
in Israel, in light of China’s numerous bids on Israeli infrastructure
and technology.
The
new committee, which the officials have suggested be led by the prime
minister, would replace an existing committee that falls under the
Finance Ministry, but is voluntary and does not cover core areas in
which China invests.
The
Prime Minister’s Office has yet to make a decision on the matter, but
the recommendation comes as the government continues to stall on
announcing the winner of the tender to build the Tel Aviv Light Rail’s
new Green and Purple Lines. The NTA Metropolitan Mass Transit System,
the government-funded company responsible for the design and
construction of the transit system, has been dragging its feet in making
a final decision.
Earlier
this week, Egged, Israel’s largest transit company, announced the
winners of a tender to buy 200 electric buses in April. All three
companies that won would be supplying buses made in China.
The
officials who have recommended the establishment of the new committee
include top officers in the IDF and the Shin Bet (Israel Security
Agency) who are concerned over two possible consequences of the
continued Chinese penetration of Israel’s economy.
The first concern is that if China continues to win tenders and
build infrastructure, Jerusalem’s ties with Washington will fray and
lead to tension with Israel’s most important ally. The second concern is
that China could use the infrastructure for espionage activities inside
and against Israel.
The winner of the Tel Aviv Light Rail tender was originally scheduled to be announced in June.
Most
of the groups competing for the multibillion-dollar deal include
Chinese companies. While the government officially says it has not
opened the envelopes to review the bids, a source with knowledge of the
matter said the government contacted one of the groups to ask why its
price was so much lower than the others.
One
of them includes the China Railway Construction Company. One of its
subsidiaries, the China Civil Engineering Construction Corp., dug the
Gilon Tunnel in the North in 2014 at a cost of about $200 million,
worked as a subcontractor on the Carmel Tunnel project for about $150m.
in 2010 and for the last couple of years has been working on the Tel
Aviv Light Rail’s Red Line to the tune of $500m.
President Joe Biden issued an executive order in June banning these companies from receiving any US investment due to suspected ties to the Chinese defense industry.
Government
officials have voiced concern that if the Chinese are nixed from the
tender it could lead to a major crisis with Beijing and see China cut
economic relations with Israel. On the other hand, if China does win the
tender, the news could strain relations with the Biden administration,
which could turn tense in the coming months amid a continued pursuit of a
nuclear deal with Iran and the White House’s declared intention to open a consulate for Palestinians in east Jerusalem.
The
committee proposed by the defense officials would sit under the
National Security Council, headed today by Hulata, who Bennett appointed
to the role in July. Hulata was in Washington this week
as part of a large interagency delegation that held talks with US
counterparts led by Biden’s National Security Advisor Jake Sullivan.
The
committee, if approved, would replace the one former prime minister
Benjamin Netanyahu established in 2019 to vet foreign investments. That
committee includes senior representatives from the Treasury, Defense
Ministry and National Security Council, as well as observers from the
Foreign Ministry, Economics Ministry and the National Economic Council.
Referral for a recommendation from the committee comes from various regulatory bodies.
The Prime Minister’s Office declined to comment on the matter.
In
response to a query, the NTA on Thursday said a decision on the tender
would be announced “soon” and after the different bids are reviewed. The
tender “was one of the largest and most complex ever done in Israel,”
it said.
Carice
Witte, executive director of SIGNAL (Sino-Israel Global Network &
Academic Leadership), which studies China-Israel ties, said: “It is very
smart to rethink the review committee, to take into consideration
critical developments and new factors that could impact Israel’s
long-term national security.”
“A
well-fashioned committee could prevent delays like the one we’re
experiencing now with the light rail,” she said, adding that the delay
on the light rail is due to government offices not being properly versed
in the relevant issues.
Bennett opposed past attempts to restrict investments from China before he was prime minister.
Yaakov Katz, Lahav Harkov
Source: https://www.jpost.com/israel-news/biden-administration-ups-pressure-on-israel-to-crack-down-on-china-681379
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