SPEAKERS
SHE Gangzheng 佘纲正, Assistant Professor, Department of International Relations, Tsinghua University
Brandon FRIEDMAN, Director of Research, the Moshe Dayan Center for Middle Eastern and African Studies, Tel Aviv University
FULL VIDEO on YouTube
REPORT
China and Israel share an extended and fascinating history of interaction. During the early Cold War period, Israel was the first country in the Middle East to recognize the PRC. In the later years of the Cold War epoch, unofficial ties between the two countries began with technological transfers, particularly in the military field, from Israel to China. Subsequently, their relationship gradually expanded to free trade in the civil sector, and in 1992 the two countries finally established formal diplomatic relations. Over the last decade, China and Israel’s economies have become increasingly interconnected despite the US influence slowing down this development. The infamous US-China trade war has had indirect effects on Israel, creating frictions in the Sino-Israeli relations. Nonetheless, on a geopolitical scale, Israel has sought to maintain close business relations with China, and in return, China has increasingly acknowledged Israel’s regional interests during the expansion of Beijing’s influence over the Middle East. What are some of the major challenges and novel opportunities ahead when discussing the future of Sino-Israeli relations?
According to She Gangzheng, Assistant Professor at the Department of International Relations at Tsinghua University in Beijing, China’s main focus is to invest in Israel’s civil sector, in particular in the infrastructure and labor service domains, as well as in the high-tech sector. As for cooperation in military technology, Professor She believes that it was once one of the most important components of their relationship – as shown in the creation of mutual trusts during the last phase of the Cold War, as well as in the first decade after the establishment of formal relations, but for now and in the foreseeable future China understands that it lacks room for military cooperation and technology transfers due to strong US scrutiny and US pressure on Israel.
Analyzing the broader Chinese foreign policy in the Middle East, Professor She affirms that, for Beijing, the Middle East remains crucial today for three predominant reasons: the supply of resources, not only the traditional energetic ones but in particular the technological ones today; its market access for Chinese infrastructures’ constructions and digital projects, such as the rollout of 5G technology; and finally, its geostrategic position as an important gateway to Europe and Africa, both of which are of paramount importance in executing the Chinese project of the Belt and Road Initiative.
One of the biggest challenges to China’s Middle East policy, however, remains locked in the regional tensions, both domestic and interstate; therefore, we wee in China a leadership that is careful not to get too deeply involved in undesirable diplomatic complications. Whilst initially this appeared to pose a marginal issue for China, with the combination of time and reality, this proposal is being increasingly challenged. Against a backdrop of mistrust between China and the U.S. – the architect of the security in the region – alongside interregional dynamics, this is an area that Beijing is struggling to navigate. China needs to be more aware of how to move around in the region. Similarly, China had a clear agenda to carry forward when building stronger relationships with countries in southern Europe, like Spain, France, and Italy. While Beijing has the potential and the tendency to do so in the rest of the area, it has not yet formulated a holistic plan for interacting with the wider Mediterranean region as a whole.
But what role does American influence play in Chinese foreign policy in the region? And how 2021 will look like in Sino-Israeli political and economic relations with the new Biden-led U.S. administration now in charge?
Washington has long pressured Israel to stop cooperation with China in several ways and has taken actions to discourage the involvement of other key countries in the BRI. Professor She provides a list of at least five domains of future competition in the Middle East between China and the U.S.: the access to strategically important areas; the security and military sales; the high-tech sector; and, last but not least, soft power in the region. President Biden is still trying to formulate a policy to be adopted in the region, but Professor She is cautiously optimistic about future Sino-American opportunities of cooperation in the region.
As reported by Brandon Friedman, Director of Research at the Moshe Dayan Center for Middle Eastern and African Studies at Tel Aviv University, an extraordinary relationship rooted in historical and strategic variables binds the U.S. and Israel. In 1985, Israel was the first country that enjoyed a Free Trade Agreement with the U.S., which quickly became Israel’s larger trading partner. Their diplomatic cooperation in peacemaking is particularly notorious: the U.S. played a vital role in Israel’s peace process with Egypt and Jordan and in establishing their economic ties, as well as trade with Turkey. Israel attempted to make with Palestine in 1999 and most recently there were Israeli normalization agreements with Sudan, Morocco, and the United Arab Emirates. The U.S. also was a key ally in diplomacy confronting Iran. In 2016 the U.S. has finalized a $38 billion package of military aid for Israel for the next 10 years and it accounts for 20% of Israel’s defense budget alongside nearly the entire Israel’s defense procurement budget.
Despite this, Sino-Israeli economic relations are becoming increasingly more important. In 2018, Israel imported more from China than from the U.S. China is particularly interested in investing in Israel’s high-tech sector, transportation infrastructure, and emerging technology.
A “New Cold War” remains a looming prognosis for the US-Sino relationship, but can Cold War rhetoric still work applied to Sino-American rivalry in the Middle East? According to Professor Friedman, this historical analogy does not apply appropriately, particularly when it comes to Sino-American rivalry in the Middle East, and especially in Israel, there are great differences that simply contradict this analytical lens.
To give some examples, Israel is now far more dependant on the U.S. than it was during the Cold War, but at the same time, their relationship has changed considerably. The regional situation in the Middle East is now also different: if during the Cold War Israel faced primarily regional and domestic concerns, today’s relations between Israel and some countries as Sudan and Morocco have been better normalized. And finally, today Israel’s economy is much more integrated into the world economy and increasingly linked to the Chinese one.
Drawing parallels from the Cold War period, Professor Friedman notes that divisional competition could take place in the field of high technology, with the Middle East divided between two different spheres of technological influence. In addition to emerging technology – like artificial intelligence, machine learning, cyber offense, and cyber defense, big data analytics, quantum encryption, etc. -, the search for strategic stability and nuclear stability (sea-based nuclear deterrents which potentially has ramifications and implications for the Mediterranean and the Red Sea) could be the second competition area.
When it comes to Israel, Professor Friedman believes that Sino-American rivalry and a Cold War dynamic will probably play a secondary role in Israel’s strategic perception and in its political behavior on the international regional, and domestic politics level. Moreover, during the Cold War Israel’s own interests were focused on state-building, state security, and regional security situation.
However, in conjunction with American pressure, in particular, under the Trump administration, Israel’s security concerns have increasingly emerged, related to the possibility that Israeli technology could find its way into the hands of state adversaries, or that Chinese growing involvement in Israel’s economy might make it possible for China to influence Israel’s domestic decision making. Some acquisitions in Israel by Chinese companies such as Alibaba and Huawei, alongside Chinese involvement in key infrastructures – such as the new terminal of Haifa port, have raised the possibility that Israel needs a mechanism to strictly regulate foreign investments in the country, especially in light of the rapidly growing investments coming from China. According to Professor Friedman, the key question today is whether Israel will be able to make autonomous political decisions for handling Chinese investments and whether it will be able to keep up the pace of business on the ground.
As for the most important variable that implicates Sino-Israeli relations, Prof. Friedman’s assessment is that this roots down to the position and influence of the U.S. in the region. This is a result of Israel’s “special relationship” with the United States, despite Israeli efforts to defend its autonomy in managing its national affairs.
In conclusion, the Sino-American rivalry will have a great impact on the future of the Middle East. So, where should we pay attention to? In the last decade, uncertainty has guided American politics: should the U.S. scale back its commitment to the Middle East or focus its political, diplomatic, and military resources more in the Asia-Pacific region? The heated debate suggests that the Middle East has somehow been downgraded in the eyes of American policymakers. Nowadays, the Biden administration aspires to give priority to Asia in its foreign policy initiatives, thereby reducing America’s military presence in the Middle East. The diminishing U.S. commitment could leave greater room for China to engage at a deeper level in the region. Observing how the priorities of the United States will evolve and especially how Sino-American relations will stabilize will be fundamental to understand the future of Sino-Israeli relations.
Report written by Simona Taravella and edited by Natasha Lock.
