Jan 5, 2022 - World

Biden administration presses Israel on Chinese investments

Biden with Bennett. Photo: Nicholas Kamm/AFP via Getty

The Biden administration and the Israeli government held low-profile consultations last month on China — a sensitive issue given U.S. concerns about Chinese investments in Israel.

Why it matters: The meeting on Dec. 14, led by deputy national security advisers from both sides, was the first wide-ranging consultation between the two countries on China since President Biden took office. The Israeli side aimed to keep it very discreet, fearing a backlash from Beijing.

The backstory: Former Israeli Prime Minister Benjamin Netanyahu worked over the past decade to build closer ties to China and court Chinese investments in Israel's infrastructure and tech sectors.

  • Chinese involvement in projects like the new port at Haifa became a rare point of contention between Netanyahu's government and the Trump administration.
  • The new Israeli government has signaled that it will take U.S. concerns more seriously and view China more through a national security lens.

Last month's meeting included representatives from various government agencies that deal with the economy, foreign policy and national security.

  • A senior Israeli official said both sides presented general policy lines and exchanged notes as they conduct their respective policy reviews, but that no decisions were reached.

Behind the scenes: National security adviser Jake Sullivan raised some of the same issues with Israeli Prime Minister Naftali Bennett and Foreign Minister Yair Lapid a week later while visiting Israel.

  • Sullivan focused mainly on Chinese involvement in infrastructure projects, concerns about China’s cyberattacks and on the need to form a unified front on China, two Israeli officials said.
  • During a meeting of Israel's Security Cabinet on Sunday, Foreign Ministry officials briefed the ministers that the Biden administration was increasing its pressure on Israel and other countries to pick sides between the U.S. and China, two Israeli officials who attended the meeting said.

What they're saying: A senior Israeli official said the Israeli government faces a major dilemma as to whether to maintain a balancing act in order to preserve trade relations with China or to more actively side with the U.S.

  • “We have no dilemma about who is our most important ally and we are more mindful about U.S. concerns and more transparent than we were in the past. But we are not going to avoid doing things with China that the U.S. is not avoiding," the senior Israeli official said.
  • The White House declined to comment.
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