from the July 2007 issue

The Israeli-Chinese Connection

The Israeli-Chinese Connection
Two items caught our attention recently: one was the announcement that Israeli investors are establishing a $155 million China fund and the other was our discussion with Mr. Zhou Hui, Chinese economic and commercial counselor at the Embassy of the People's Republic of China. We were taking part  in a visit to the Ashkelon seawater reverse osmosis (SWRO) plant - the largest in the world. Mr. Hui revealed that his country is negotiating the purchase of a desalination plant.

Research reveals that Israel-China trade climbed nearly 30% in 2006, to $3.8 billion, and is expected to reach $5 billion this year, catapulting China to the position of Israel's number two trading partner, second only to the U.S.

From 1978 to 2005, China's GDP increased by 11 times, from 200 billion US dollars to 2,200 billion dollars. Its GDP per capita increased from 220 dollars to 1,700 dollars. Last year, China's foreign trade amounted to 1.4 trillion dollars. As of last February, China's foreign reserves stood at 850 billion dollars. This dynamic growth makes China an ideal target for trade.

At first sight, it is difficult to imagine two nations more different to each other than China and Israel. China is four hundred times Israel's size and two hundred times its population. One is the heart of Asia, the other is a bridge between West and East.

Yet, the two countries share a number of similarities. The principal trait is their long history. Both nations span at least four millennia, being the oldest nations on earth who claim such continuous national identity.

The maxim "Don't do to others what you don't want them to do to you" is essential to both civilizations, Jewish and Chinese, as well as the principle that human nature is basically good.

Both China and Israel started a process of modernizing their economy. The models upon which Mao Zedong and Ben-Gurion conceived the economy was state-oriented, while the more recent leaders of both countries launched a campaign to open their economies to the free market.

Various cooperative forms in the agriculture area, include  joint research and development, import of equipment, training, and demonstration farms. Israel has also provided China with military assistance, expertise and technology. According to a report from the US-China Security Review Commission, "Israel ranks second only to Russia as a weapons system provider to China and as a conduit for sophisticated military technology, followed by France and Germany."

Considering that Israeli-China relations began only 15 years ago the achievements have been impressive and appear to have a bright future.

Reprinted from the Israel High-Tech & Investment Report July 2007

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