What are Beijing’s real intentions? Israel-China relations and the Belt and Road Initiative

This is a guest post by Aron Shai. Read more in his new book, China and Israel: Chinese, Jews; Beijing, Jerusalem (1890-2018).

Recently, we have learned that, within the new Silk Road-style trade network—the Belt and Road Initiative (BRI)—Italy has become the first G7 country to back that original Chinese scheme that few countries approve of. In fact, Italy’s allies—Europe and the United States—are annoyed by Rome’s move. The BRI is no doubt an ambitious project that envisages Chinese investment in a network of infrastructure projects connecting Asia, the Middle East, Africa and Europe. Is China using the project to embolden its political and strategic clout?

In many countries there is a serious division of opinion regarding China’s recent initiatives. What are Beijing’s real intentions? Is China employing “soft power” tactics aimed at controlling various stations and ports from Darwin in Australia to Piraeus in Greece? Is it a new imperialist power hoping to retain control over South East Asia and East Africa while its next targets are the relatively weak economies of Europe?

There are those who believe that agreements with China could revive weak or stagnant economies and bring much-needed investments for countries who need it most, whether ports, railways, roads, power stations and other infrastructural elements are concerned. Also, exports to China’s lucrative market could thus be boosted.

In the fascinating story of Israel-China relations, unique history and culture intertwine with complex diplomacy and global business ventures, as China’s recent Belt and Road typifies quite clearly. What are the opportunities and risks involved as China purchases companies that are part of Israel’s national infrastructure? What could China’s investments cause?

Indeed, when we study the broad history of China from the Opium War to the inheritors of Mao Zedong, we see clearly that in the past eighteen centuries, China has undergone a fascinating process of transition. It has moved from a position of subjugation and humility against the Western powers, into national resourcefulness, overweening pride and even hubris. China’s actions, including their use of “soft power,” may prove the term hubris apt. China’s economic power and its financial reserves are at the apex of a process of “translation” into the language of “hard power”—in other words, conventional power. We may assume that at least in the observable future, this process will not fade, but rather intensify.

The chief conclusions regarding China’s powers indicate to policy-makers in Israel that they must reevaluate their long-standing policy toward China. They must abandon the traditional line that is satisfied with mere “maintenance” of relations with China. Instead, Israel must upgrade these ties and adopt a more assertive policy, and perhaps even encourage China to engage in broader involvement in the Israel-Palestinian conflict and in tensions between Israel and Iran and its other neighbors.

Still, Israel must be wary of sharp turns, and internalize the warnings of challenges awaiting those who blindly follow the Chinese lead. A red light has been lit by the purchase of Tnuva, an Israeli food processing cooperative historically specializing in milk and dairy products, by the Chinese company Bright Foods. Tnuva for decades had symbolized the rebirth of Zionism in the State of Israel. The aim of Chinese companies to win the long-term contract for construction and operation of the railroad from Eilat to Ashdod (the Red-Med Project), Chinese interest in purchase of insurance companies (which own pensions and savings plans of many Israeli employees), and Beijing’s aspiration to win tenders for construction and operation of the two private ports in Ashdod and Haifa are all cause for serious consternation. Objections to these moves, especially the Haifa project, include broad strategic and fundamental questions on the very definition of national resources that must not be handed over to foreign entities.

Lately, in light of Washington’s annoyance, there was raised the suggestion that perhaps Israel should back off and even cancel the contract signed with the Chinese concerning the port of Haifa, a contract which includes a twenty-year concession to operate the port. Again, as in previous occasions, decision-makers are faced with a serious dilemma: should they alienate the Americans in order to have the Chinese as serious business partners, especially within the wide framework of the Belt and Road Initiative?

Where does Israel define its borders in the process of close cooperation with the Chinese? It seems that despite the need to work closely with China and deepen China’s involvement in Israeli and Middle Eastern affairs, Israel must avoid getting carried away. It should not focus only on economic aspects of relations with China with the intention of exploiting them to the maximum, meanwhile hoping that Beijing would ignore the political issues that are less desirable to Israel. Israel must also avoid the expectation that China would fulfill its requests in the political arena (containing the Iranian threat or altering altogether its traditional support for the Palestinians, for example).

Indeed, one of the questions that disturbs the European, Latin American and African states is to what extent China is obtaining a global foothold in peaceful ways, through economic propagation and gradual takeover, sometimes under cover of aid. Is this imperialism of the sort that recalls the American imperialism of the past, an imperialism that was not based on settlements and colonies, but rather on economic deterrence and power?

Aron Shai is Shaul N. Eisenberg Professor of East Asian Studies and Pro-Rector of Tel Aviv University. He earned his PhD from St. Antony’s College, University of Oxford. His research focuses on imperialism in Asia, China’s role in international relations, diplomatic and economic history, and Sino-Israeli relations. He lectured at international conferences and served as guest professor at Oxford, Paris, Toronto, New York and in China. Shai authored and edited numerous books in Hebrew, English, and Chinese, including Origins of War in the East; From the Opium War to Mao Zedong; Britain and China 1941-1947; The Fate of British and French Firms in China 1949-1954; Twentieth Century China; and Zhang Xueliang—The General Who Never Fought. He has also written two historical novels.