US & Chinese flags
US & Chinese flags Istock

According to a report in the Manila Standard, a large Israeli technology conglomerate with subsidiaries in China has decided to transfer all its operations from China to the Philippines by the end of 2021.

The director-general of the Philippine Economic Zone Authority (PEZA) told the Standard that a memorandum of understanding would be signed in the coming weeks, and that the Israeli firm “will be bringing here all 16 companies it has in China.”

The news will be another blow to Chinese hopes of enhancing its economic ties with Israel, following what had seemed like a promising future just a few years ago, when Chinese Vice-President Wang Qishan visited Israeli Prime Minister Binyamin Netanyahu in Jerusalem to co-host a major innovation summit.

The South China Morning Post noted that Wang was the “highest-level official to visit Israel in decades” and that the trip was “widely seen as a sign of deepening bilateral ties.” Under Netanyahu’s leadership, China has become Israel’s third-largest trading partner, and the Asian superpower has companies invested in major infrastructure projects in Israel, including construction projects in the ports of Haifa and Ashdod.

However, China has been concurrently deepening its ties with Iran, and indeed continues to do so. In July of this year, the New York Times reported that China and Iran were drafting a 25-year trade and military agreement, one which could potentially alleviate the dire economic situation in which Iran finds itself due to U.S.-imposed sanctions related to its nuclear program.

A month later, U.S. Secretary of State Mike Pompeo visited Israel, and allegedly pressured Netanyahu to limit Israel’s relations with China, citing the looming China-Iran deal as justification. This was not the first time the U.S. had sent such a message to Israel, and previous “friendly suggestions” were probably at least in part responsible for Israel’s decision to award a valuable contract for the construction of a desalination plant in Tel Aviv to an Israel company rather than the Chinese company that was also a key bidder.

Then, in October, U.S. Treasury Secretary Steve Mnuchin visited Israel and met with Netanyahu – and a day later, the government’s security cabinet met to discuss establishing a regulatory body that would supervise foreign investment projects in the country, focusing on projects that would “give Chinese companies access to data of Israeli or U.S. citizens or to U.S. military technology used by Israeli security forces,” the Middle East Eye reported.

Mike Pompeo’s latest visit to Israel was conspicuous for an itinerary that gave prominence to the Jewish presence in Judea, Samaria, and Jerusalem, but it is certainly reasonable to assume that Pompeo made some more “friendly requests” of Netanyahu during their meetings together, and that this latest decision by an as-yet-unnamed Israeli conglomerate is one of the results of those “requests.”