📖 Your Q2 Earnings Guide: Discover the Stocks ProPicks AI Highlights to Jump Post-EarningsRead more

With eye to China, Israel forms panel to vet foreign investments

Published 10/30/2019, 01:30 PM
Updated 10/30/2019, 01:36 PM
With eye to China, Israel forms panel to vet foreign investments

By Steven Scheer

JERUSALEM (Reuters) - Israel decided on Wednesday to form an advisory committee to weigh national security aspects of prospective foreign investments in Israeli companies after coming under U.S. pressure over business deals with China.

The Israeli security cabinet's move to set up the panel followed a visit to Israel this week by U.S. Treasury Secretary Steven Mnuchin, although discussions on the issue have been going on for the past three years.

With many Israelis alarmed by President Donald Trump's withdrawal of U.S. troops from northern Syria, Washington's warnings about the security aspects of Chinese investment in Israel had threatened to widen a schism with its closest ally.

A statement issued by Prime Minister Benjamin Netanyahu's office said the committee would be comprised of officials from the finance and defense ministries who would consult with the foreign ministry and various security agencies.

The panel, it said, would begin work early next year and aim to find "the appropriate balance" between national security considerations and "the need to encourage foreign investments in Israel and ensure continued economic prosperity".

The statement did not mention any potential investor by name, an apparent attempt to avoid alienating China, which has stepped up its investments in the country in recent years.

Regulators would approach the committee on a voluntary basis and the panel would act in an advisory capacity, dealing only with investments that required Israeli government approval, such as telecommunications, energy and transportation projects.

In January, a U.S. official cautioned Israel over investments from China, citing cyber-security concerns and the prospect of Israel’s allies limiting intelligence-sharing with it.

Chinese investment in Israel's tech sector reached more than $325 million in 2018, an Israeli venture capital research group said.

In a deal that drew U.S. concern, China won Israeli approval to build a private seaport near Haifa, a berth for the U.S. Mediterranean fleet.

In what was widely seen in Israel as a sign of U.S. displeasure at the Chinese involvement in Haifa, one of the Sixth Fleet’s warships a year ago docked in Israel’s second-tier Mediterranean port of Ashdod, the fleet’s first such visit in almost 20 years.

Interest by Huwaei Technologies Cos Ltd and ZTE Corp (HK:0763), two of China’s biggest network equipment makers, has also worried Washington, as has the green light granted to China’s Shanghai International Port Group in 2013 to build the Haifa seaport.

The Trump administration has taken steps to curb market penetration by Huwaei and ZTE, seeing them as spying threats.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.