Trade and investment cooperation between China and Israel has accelerated since 2000, especially in the generation and infrastructure sectors. While Tel Aviv has subsidized the Belt and Road Initiative (BRI), China recognizes Israel’s strategic location. While the two countries have 30 years of diplomatic relations, China and Israel hope to reach a flexible trade deal by the end of 2022.
Prior to the status quo of official diplomatic relations, China and Israel had already established their respective representative workplaces in Beijing and Tel Aviv to serve as “de facto embassies. “The Israeli workplace in Beijing, officially known as the liaison workplace of the Israeli Academy of Sciences and Humanities, officially opened in June 1990. Similarly, in the same year, the Chinese government opened the branch of the China International Travel Service in Tel Aviv.
Diplomatic relations between the two countries were officially established in January 1992. Since then, China and Israel have taken a step forward in their relations, which peaked with President Jiang Zemin’s scale in Israel in 2000. Since then, 4 presidents and 3 prime ministers have made official stops to Beijing, adding the last Prime Minister Benjamin Netanyahu in March 2017.
According to an official statement, Xi Jinping and his Israeli counterpart, Isaac Herzog, had their first official contact by phone in November 2021. The two leaders exchanged perspectives on tactics for China-Israel bilateral relations, and their renewed commitment in view of the 30th anniversary of the status quo of diplomatic relations between the two countries. On this occasion, they also issued invitations to meet in person.
Between 1995 and 2022, foreign direct investment (FDI) in Israel averaged $14. 28 billion, peaking at $112 billion in the third quarter of 2021.
Israel has a creative, educated, professional and varied workforce, as well as an entrepreneurial spirit. It is a pioneer of innovation in many sectors, and many Israeli start-ups locate fruitful partners with foreign corporations. Up Nation”, the country is making significant investments in science and education. After China and the United States, Israel has the third largest number of indexed corporations in the NASDAQ inventory market. Several Israeli government organizations, in addition to the Israel Innovation Authority, are guilty of investment incubators for tech startups.
In 2022, a small percentage of China’s total foreign investment goes to Israel, and the country’s expansion rate is also lower than the expansion rate of China’s overall foreign investment. China has a higher average annual investment in Israel since 2002, with annual investment expanding from $20 million to more than $200 million.
Data from the Institute for National Security Studies shows that China’s investments and mergers and acquisitions in Israel have massively targeted the tech sector (449 deals with a report of around US$9. 14 billion through 2019).
In addition to the generation sector, 8 agreements were signed in the infrastructure sector with a total price of US $ 5,910 million, adding 4 agreements in the shipping sector, two in the port sector and two in the electric power sector, all signed through the Chinese state -empresas. empresas propia (EP). One transaction concluded in agriculture and real estate (the acquisition of Tnouva), another in the minerals sector (the acquisition of Adama), two transactions involved investments in educational establishments (the Technion and Tel Aviv University), and some other similar to the advertising industry (the acquisition of Bagir).
The two high-tech sectors in which the Chinese have invested the most are the progression of software and computing ($1120 million) and exercise science ($1350 million). generation sectors, to obtain the complex wisdom and functions necessary for the country to face demanding situations similar to those of medicine and the pharmaceutical industry.
It is also unexpected that China is expanding its investments in Israel’s chip and semiconductor industries, as well as in the progression of software and computing. A good example is chinese e-commerce giant Alibaba’s investment in the budget of Jerusalem Venture Partners (JVP), operating in the cybersecurity box.
Over the past two decades, the goods industry and between China and Israel has increased significantly. Israel’s Central Bureau of Statistics (CBS) reports that the price of the industry between Israel and China increased from $1. 07 billion in 2001 to $17. 54 billion in 2020.
China has become Israel’s third-largest trading partner, but it remains far from the European Union ($40 billion in 2020) and the United States ($18 billion in 2020), even though Israel trades with China more than any other individual European country.
Israel, however, has experienced an industry imbalance with China, as Chinese exports to Israel are almost double Israel’s exports to China. On the other hand, Israel’s imports from China continue to grow and reached a record $7. 66 billion in the same year.
Israel’s exports of goods to China in 2020 reached $6290 million. Integrated circuits ($2130 million), other measuring tools ($416 million) and X-ray machines ($218 million) were Israel’s main exports to China.
On the other hand, China exported $11. 25 billion in goods and to Israel in 2020, with the main categories being clothing ($250 million), transmission apparatus ($224 million) and heterocyclic nitrogen compounds ($213 million).
China’s exports to Israel have grown at an average rate of 16. 6 over the past 25 years, from $192 million in 1995 to $11. 25 billion in 2020.
In 2017, China and Israel announced that they would usher in a new phase of his hip. China-Israel have noted collaboration in various fields, from the Belt and Road Initiative (BRI) to generation and innovation exchanges.
The Economist Intelligence Unit’s BRI threat assessment report noted that Israel has the lowest investment threat of the moment, making the market incredibly hot with China, which is lately a more strategic regional presence.
A developing geoeconomic alliance with Cyprus, Egypt and Greece, the great progression of energy resources in the eastern Mediterranean, the opening of new ports and the status quo of industrial routes with its Arab neighbors make Israel a very hot BRI market for China.
According to the knowledge of Israel’s Ministry of Transport and Road Safety, the country lately spends around $5 billion a year to improve its transportation infrastructure, adding the structure of airports, seaports, railways, roads and tunnels. Taking advantage of those opportunities, in recent years, Chinese corporations have undertaken primary infrastructure and transportation projects in Israel, and have won contracts to build new ports in the southern Israeli cities of Ashdod and Haifa, as well as a component of Tel Aviv’s rail system.
The new port logo in Haifa Bay, a city in northern Israel that serves as the country’s commercial and shipping hub, has proven to be good fortune for the toned goods industry. Since its inauguration in September 2021, the port has already lowered import costs and boosted Israel’s economy, given that shipping is the main mode of transportation for the country’s foreign industry.
The Shanghai International Port (Group), which received a 25-year franchise to operate the port, built it as an automated container port. The site can handle 1. 86 million consistent 20-foot equivalent sets per year for an expense of US$1. 7 billion.
In 2021, China officially overtook the United States as Israel’s largest source of imports. In an effort to diversify its foreign exchange reserves, Israel added the Chinese yuan to its central bank’s reserves for the first time in April 2022, while reducing its holdings of U. S. currencies. dollars and euros. Finally, until the end of 2022, a flexible trade agreement (FTA), under discussion for several years, deserves to be concluded by either party.
As China and Israel celebrate 30 years of diplomatic relations, it is transparent that their bilateral economic and industrial ties are deepening. While China-Israel cooperation is bound to flourish in key sectors, some demanding situations persist in the form of geopolitical pressures.
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