White House Senior Official Warns Israel About Chinese Investment

By Kitty Wang

The United States and some European countries have been raising awareness of the threat posed by china stealing technologies. But China has found another way around. It’s increasing investments in Israel as a back door to getting their hands on western technologies.

Senior officials from the White House National Security Council gave Israel a warning in Washington last week.

Victoria Coates, Senior Director for the Middle East, US National Security Council said, “One of our concerns, as we see China expanding role in the middle east, is how China interfaces with the Israeli tech sector.”

Coates said Israel did extremely well in high-tech research and development—an area in which the United States and Israel work closely. However, Chinese investments in the same industry in Israel increased ten times in 2016, and its venture capital fund grew by 20% last year.

She said the United States is certainly not saying “No China” to Israel, but hopes that investments develop in a responsible way that is mindful of Israel’s national security interests.

“We have developed certain tools, CIFUS for example, that review foreign investments, not only China alone of course. And we have found these effective means to protect our national security interests, while also developing our economy,” Coates said.

This year, President Trump and Secretary of State Pompeo both warned Israel about security threats coming from China. In addition to threats coming through the high-tech sector, Israel has let a Chinese state-controlled enterprise operate its largest international seaport. The Chinese Communist Party also invested in Israeli infrastructure, especially in the telecommunications industry, but the U.S. has warned, that may jeopardize their intelligence-sharing with the U.S.

“China expanded its power at the expenses of sovereignty of others; China gathers and exploits data on an unrival scale, and spreads features of its authoritarian system, including the use of surveillance,” Coates said.

Chinese investments in other Middle Eastern countries are expanding too. Experts are especially concerned that the Chinese Communist Party is trying to export its authoritarian rule by expanding its surveillance technologies.

Jonathan Fulton, Assistant Professor of Political Science at Zayed University said, “There is no doubt it’s very attractive, because they can look at this model of tremendous economic reform without correspondent political reform.”