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December 19, 2013 11:48 am

Israel, China Economic Cooperation in Focus With Chinese FM Visit to Jerusalem; Iran Nukes Also on Agenda

avatar by Joshua Levitt

Chinese Foreign Minister Wang Yi and Israeli President Shimon Peres, in Jerusalem, on December 19, 2013. Photo: GPO / Mark Neiman.

Chinese Foreign Minister Wang Yi and Israeli President Shimon Peres, in Jerusalem, on December 19, 2013. Photo: GPO / Mark Neiman.

Chinese Foreign Minister Wang Yi was offered an Israeli welcome fitting of a head of state this week, with meetings in Jerusalem with both Prime Minister Benjamin Netanyahu and President Shimon Peres on Wednesday and Thursday, as each side made it clear what they sought to gain from their budding alliance.

For China, the goal was commerce, and specifically, access to Israeli technological know-how. For Israel, the business angle is a boon, but its more pressing aim was to secure a strong international partner who can echo its concerns over Iran’s nuclear program to sometimes deaf ears in Washington.

At their meeting in Jerusalem, the Chinese foreign minister told Netanyahu that he had “come to pursue stronger cooperation between our two countries.”

“Our two economies are highly complementary, and the mutually beneficial cooperation between us enjoys a very bright future,” he said. “During your visit to China this year, Mr. Prime Minister, you reached a very important agreement with President Xi Jinping, and Premier Li Keqiang of China on how to further deepen the mutually beneficial cooperation between our two countries. I have come to explore with my Israeli counterpart on how to further implement all the important consensus and explore the various areas of even stronger cooperation between us so as to deliver greater benefits to both peoples.”

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In that time since Netanyahu’s May visit, the two countries had signed a $400 million trade agreement, expanding bilateral trade to $2.05 billion; Chinese magnate Li Ka-Shing, among the nation’s richest billionaires, gave $130 million to Israel’s Technion University, to establish the Technion Guangdong Institute of Technology, with Guangdong Province providing another $150 million for the campus —  the first time a school from any other country has been invited to establish an entirely new academic college based in China; Tsinghua University sealed an alliance with Tel Aviv University to develop life sciences research and development in China, along with a 100 million yuan ($16 million) investment to seed ventures created by the program; Chinese conglomerate Fosun International, which bought Israeli medical equipment manufacturer Alma Lasers in April, announced plans to open an Israeli technology incubator; and, in December, Israel’s Tower Semiconductor, one of the country’s oldest, largest and most emblematic technology companies (it turns sand into silicon), signed a deal in China to expand the distribution of complementary metal-oxide-semiconductors into their market.

While the Chinese talked business, Netanyahu on Wednesday, and then Peres on Thursday, brought the conversation back to Iran:

“We believe that for the peace of the world, for the peace of the coming years and decades, Iran must be denied the capability – I stress the word – the capability to develop nuclear weapons,” Netanyahu said. “It must fully comply with UN Security Council resolutions. It must end all enrichment, dismantle its centrifuges, eliminate all stockpiles of enriched uranium and dismantle its heavy water reactor in Arak so that it will not be able to produce plutonium. I think that this is something that the international community in its entirety must stand firm on.”

After his meeting with the Chinese foreign minister on Thursday, Peres said, “The threat of a nuclear Iran must be met. The chance for peace must not be ignored. China, as a key player in the global arena can play a crucial role in the effort to prevent a nuclear Iran.”

Foreign Minister Wang Yi said, “We talked about Iran and I told Mr. President that with joint efforts of the various parties, the P5+1 and Iran reached an important, also preliminary, agreement marking the first step towards the settlement of the Iranian nuclear issue.”

“What is important now is for all the parties concerned, Iran included, to fully comply with their respective obligations and responsibilities prescribed in this deal and for all the parties to work together to uphold the international non-proliferation regime and for promoting peace in the Middle East region,” he said.

Experts watching the dance between Israel and China said the closer ties, on both fronts, make sense.

“The reality is the ideas, the joint ventures, the high technology, is all coming from the Chinese working with Israeli companies,” said Dr. Joseph Pelzman, Professor of Economics, International Affairs and Law at the Institute for International Economic Policy the Elliott School, George Washington University, in Washington, D.C., and a permanent visiting professor at Ben Gurion University of the Negev, in Be’er-Sheva.

“The Chinese are fully aware that all the inputs, the microprocessors, the semi-conductors, are coming from Israel, and Israel is more than willing to help them innovate.”

Prof. Pelzman, who spent the past year as a Fulbright Scholar in Beijing, said that what the two countries also share is the same model, publicized by Israel in the 1960s, where the policy was to invest in public education and growth.

“Although lots of Western countries paid lip service to that theory, China really was the only one that ran with what Israel did, and used the Israel model to develop so quickly, and this has just been in one generation.”

But while China can certainly be at the table as a global economic power, the question of its influence, on behalf of Israel, in political matters remains to be seen.

“On one hand, the Chinese can certainly appear as honest brokers to the Arabs,” Prof. Pelzman said. “China doesn’t need their oil – they get all they need from the Russians, and the fields in Kazakhstan are close enough if they need more. And Israel has natural gas. The Arabs, except for the Emirates, have no technological innovation, anywhere. Meanwhile, the Chinese don’t have the long historical, European-based, anti-Jewish sentiment, while the Muslims in China have their own worries, so it’s not a question of having to appeal to any domestic concerns.”

“I think part of the Chinese perspective with being a new giant is playing with the big boys. As the biggest owner of U.S. debt, yes, there could be some leverage there. But they don’t really have any influence with the Iranians, no one really does, even the Russians,” he said.

“Everybody wants a piece of the Iran business, and what sanctions have done, in economic terms, is just the raise the price of doing business there.”

“Nothing has changed in Iran, it’s the very same people in power, the same Ayatollahs, with the same authoritarian system. Why should anybody expect it to be different now? They say one thing in English, another in Farsi, and another in Arabic. If they’ve learned Chinese, they’d say something different to them, too!”

Meanwhile, the Chinese foreign minister, visiting the Israeli leaders in Jerusalem, ended his visit on Thursday with a more positive, and philosophical note:

“I told the president that before I came here I went to the top of the Mount of Olives and saw the Old City,” he said.

“In these two kilometers I saw that it is home to a large number of holy sites of civilizations and religions. We hope and believe that the various religions and civilizations will be able to integrate rather than clash, learn from and exchange with each other rather than live in mutual estrangement. We believe this day will eventually come.”

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