Israel, Pressed By US, Blocks First Big Chinese Deal

By ARIE EGOZI

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TEL AVIV: The strict U.S warning to Israel to limit ties with China has its first result as the Chinese failed to win a tender for the construction of the giant desalination plant in central Israel. The Palmahim site is in close proximity to Israel’s missile test and satellite launch facility.

The Soreq 2 facility, with the capability to process 200 million cubic meters of water per year, is expected to be the largest of its kind in the world, increasing the state’s desalination capacity by about 35%. The new desalination plant joins five facilities already operating in Israel. Two weeks after US Secretary of State Mike Pompeo met with Prime Minister Benjamin Netanyahu and warned against further Chinese involvement in projects in Israel the Chinese company lost and an Israeli company, IDE.

That may lead to a confrontation with the Chinese. Two weeks ago, Netanyahu told Pompeo that the issue was under discussion by the Foreign Investment Committee at the Treasury. The US fears Chinese investments could create dependencies on China’s companies and countries, and is working to prevent them.

The next challenge: the Chinese and the power companies. In coming days, a decision will be made whether to award the Chinese government company China Harbor’s bid for the power plant of Ramat Hovav, part of the huge reform of Israel’s once government-owned electricity sector.

“The fact that the (Pompeo) visit takes place in these problematic times proves its urgency ” an Israeli source told BD. Pompeo came to Israel with a very strict message – stop all Chinese investment in Israel, either in high tech companies or infrastructure.

Israeli officials said the message relayed during Pompeo’s visit included a very specific political warning – Israel must stop any action that strengthens the Chinese Communist Party, even if that means canceling planned projects. For context, think of the numerous times President Trump has called the coronavirus the Chinese virus and blamed China for supposedly hiding the truth about the virus’ origins.