How Israel Should Handle the US-China Rivalry
Israel recently pledged that it will notify Washington about certain deals it strikes with China, and promised to reexamine those deals if the US raises concerns. The announcement came amid a campaign, launched first by the Trump administration but continued by the Biden administration, to enlist Israel in America’s great power competition with Beijing.
There are still some gaps to bridge. But the Israelis deserve credit for supporting the US-led effort. Unfortunately, Washington’s policy for other Middle Eastern nations is scattershot.
American efforts to prevent advanced military technology from finding its way to China are not new to Israel. The 1999 disagreement over Israel’s sale of Phalcon radar systems to China was a wake-up call for the Israeli defense industry. A similar flap in 2004 — over the proposed Israeli sale of upgraded Harpy unmanned aerial vehicles — pushed the Israelis to create an export control agency some three years later. Subsequent to that, China was largely a non-issue for more than a decade. But that changed with US assessments that some Israeli technology with possible military dimensions was flowing to Beijing.
To be clear, the Israelis were doing what many other countries were doing, including the United States. They were selling products to the world’s second largest economy. The Israeli government was certainly not intentionally conveying to Beijing any military technology that China could wield against American war-fighters. Rather, the Chinese were surreptitiously acquiring Israeli tech that had possible military applications, and then providing it to the People’s Liberation Army. This is all part of China’s Military Civil Fusion effort, which has helped fuel the most aggressive military modernization effort in the history of the People’s Republic of China. As a result of this modernization, the US military edge is rapidly eroding.
Seeking to contain China’s rise, Washington turned to its allies for help. Israel is key among them.
The government of former Israeli prime minister Benjamin Netanyahu was somewhat resistant to a policy shift. As the longest-serving prime minister in his country’s history, the economic growth of Israel was one of the keys to his success. China accounted for more than $17 billion in trade with Israel, or roughly 4.3 percent of GDP, in 2020. This is not chump change for a tiny nation like Israel.
But with the change in governments in 2021, Prime Minister Naftali Bennett and Foreign Minister Yair Lapid have worked to strengthen the foundation of the US-Israeli alliance. High level discussions in both Jerusalem and Washington have brought about a more effective modus vivendi between the two countries on China. Concurrently, Israeli business with China appears to be trailing off, thanks to Israeli entrepreneurs’ distaste for some of China’s dodgy business practices and the value they place on their relationship with the United States.
For Israel, the trick is to respond to US concerns while not needlessly creating an enemy in Beijing. Indeed, Israel already has enough enemies in the region. Creating friction with a rising superpower is something Jerusalem can ill afford. This explains why Jerusalem’s approach to Beijing will be different, at least in tone, than Washington’s. The Israelis want to respect American security concerns, while ensuring that legitimate business with China can continue apace. From all appearances, they are moving in the right direction.
Yet, one gets a sense that the Israeli concessions are too often unilateral and unreciprocated. Admittedly, Israel is the junior partner in the US-Israel alliance. One might expect Washington to sometimes throw its weight around. But it cannot be ignored that Israel is making these important compromises against the backdrop of an American push to return to the controversial 2015 Iran nuclear deal. Israeli officials (in this government and the previous one) have both warned that this deeply flawed agreement will fill Iranian coffers and enable the regime to better fund its terrorist proxies. Worse, it will grant Tehran a clear path to acquiring nuclear weapon.
In other words, Israel continues to cooperate with the United States on its top security challenge (China), while the Biden administration effectively ignores Israel’s concerns about its top security threat (Iran).
To make matters worse, Iran and China are strengthening their ties.
Iranian Foreign Minister Hossein Amir-Abdollahian visited Beijing last week to solidify a 25-year “comprehensive strategic partnership,” inked in March of last year, which will funnel billions of dollars in Chinese investments into the Iranian economy. This will make US sanctions against Iran less effective, and increase the chances that military action may be required to halt Iran’s nuclear advances. However, increased Sino-Iranian military cooperation could make that more difficult.
As my colleagues Bradley Bowman and Zane Zovak noted recently in Foreign Policy, the Iran-China partnership only bolsters “Beijing’s burgeoning clout in the Middle East,” while also driving home “the reality that Washington’s great-power competition with China won’t occur in the Indo-Pacific alone.” Yet, the White House seems unconcerned. All the while, it is preparing to provide billions of dollars of sanctions relief to the clerical regime. This hardly seems logical from Israel’s perspective.
Meanwhile, Washington’s Gulf Arab partners are boosting their trade and security cooperation with China. Saudi Arabia and the United Arab Emirates have increased arms purchases from China. Last week, the foreign ministers of Saudi Arabia, Kuwait, Oman, and Bahrain, and the secretary-general of the Gulf Cooperation Council (GCC), all visited China to advance ties with Beijing. If there are serious American efforts to halt this activity, Israel has not seen them.
Nonetheless, Israel’s commitments to the United States regarding Chinese business deals remain firm. Chinese investments will receive the scrutiny required to ensure that Israeli technology is not wielded against the United States by its most dangerous adversary. The Biden administration has not exactly rewarded this. Right now, remunerations appear to include plans for enriching Israel’s most dangerous enemy, and maintaining double standards for its peers.
Jonathan Schanzer, a former terrorism finance analyst at the US Department of the Treasury, is senior vice president for research at Foundation for Defense of Democracies. He is author of the new book “Gaza Conflict 2021: Hamas, Israel and Eleven Days of War” (FDD Press, November 2021).