Israel pivots to Asia

Former Israeli prime minister Benjamin Netanyahu’s Likud party is set to form a stable 64-seat far-right coalition following November 2022’s legislative election. The shape of this government, along with Netanyahu’s personal criminal trial, will impact how this new government approaches Israel’s relations with Asia.

East Asia Forum reminds that during Netanyahu’s extended stint as prime minister from 2009 to 2021, he spearheaded Israel’s pivot to Asia. Netanyahu’s administration launched free trade negotiations with China, India, South Korea and Vietnam. Defence ties with Thailand were initiated in 2017, security cooperation with South Korea and the Philippines grew and weapons sales to India and Vietnam flourished.

But the highlight of Israel’s pivot to Asia was in its relations with China. Netanyahu took great pride in advancing business and technology ties with China. The countries forged an innovation partnership in 2013, with Netanyahu establishing the Israel–China Joint Committee on Innovation Cooperation.

Efforts to ‘put the Israeli chip into the Chinese machine’, as Chinese Foreign Minister Wang Yi put it during a visit to Israel soon led to a second visit to China by Netanyahu. During that 2017 trip, he and Chinese President Xi Jinping agreed to raise the status of the relationship to a Comprehensive Innovation Partnership.

As Netanyahu once again takes the reins as Israel’s prime minister after a hiatus of over a year, he is facing a changing world and a very different domestic context.

On the international front, tensions between China and the United States have intensified. Not only have former US president Donald Trump’s sanctions on China remained in place under President Joe Biden, but they have been escalated to previously unseen levels. Communication deteriorated between the two rivals, reaching a new low with US House Speaker Nancy Pelosi’s visit to Taiwan. US concern over Israel’s high-tech cooperation with China has continued, especially in areas like artificial intelligence, cyber and chip design.

At the same time, Israel’s media has reported widely on troubling news from China. Reports have covered the treatment of Uyghur Muslims in northwest China and the implications of Hong Kong’s newly instituted national security law. During the period that Netanyahu sat in the opposition, public perceptions of China in Israel deteriorated.

At the same time, the Abraham Accords — which established diplomatic relations between Israel, the United Arab Emirates (UAE), Morocco and Bahrain — have continued to strengthen, with the UAE and Israel having concluded a free trade agreement in a record four months.

With the Biden administration looking to India to counterbalance China not only in Asia but in the Middle East as well, it helped form I2U2Я as a partnership linking East and West Asia. The members of the I2U2 grouping — India, Israel, the UAE and the United States — agreed to launch a joint food technology project. According to the agreement, Israeli technology and UAE funding will also help to form a research and development centre in India.

With Netanyahu’s return to power, it might be expected that he will reprise his role as an international statesman seeking to firm up Israel’s position in Asia. But this time Netanyahu is facing not only a different world but also a different coalition. For the first time, Netanyahu and his Likud party will be the left-wing arm of Israel’s governing coalition, which will be mostly comprised of right-leaning and religious parties that are seen by some in the US administration as extremists.

During his last run as prime minister, Netanyahu was personally invested in Israel’s pivot to Asia, but he will now be focussed on managing his coalition while fulfilling his many campaign promises. The parties that put him in power will be demanding that the prime minister focus on his commitments to them regarding settlements and the complex question of judicial power in the state of Israel — two subjects that do not sit well with the current administration in Washington.

For the foreseeable future, Netanyahu, who Washington views as a supporter of the Republican party, will be focussing on domestic concerns. But this does not mean that Israel’s pivot to Asia is over.

The success of the government led by Naftali Bennett and Yair Lapid during 2021–22 in advancing ties with Asia looks well-placed to continue. A free trade agreement with Japan is under negotiation, and Israel’s outgoing Defence Minister Benny Gantz signed a memorandum for defence cooperation with his Japanese counterpart Yasukazu Hamada in August 2022. The memorandum will enable the two countries to widen defence, strategic and military exchanges.

While cooperation with Asia will continue to expand and deepen, managing the relationship with China will prove more difficult. Being a savvy, experienced politician, Netanyahu will pick his battles. Washington may well discover that Israeli compliance with its China policy will come more easily.

Israel’s 15th prime minister will likely contribute less directly to Israel’s ongoing pivot to Asia. While dealing with his own criminal case, he will keep his eye on prospects closer to home — expanding ties with Bahrain, pursuing the warming of relations with Turkey, continuing to build on the Abraham accords and cultivating relations with Saudi Arabia. Netanyahu will, of course, also be focussed on addressing the national security threat posed by Iran and its proxies.

But Netanyahu’s domestic and regional focus will not define Israel’s image in Asia, where there is growing interest in its advanced innovation, technological capabilities and defence systems. At the same time, Asia will continue to present many opportunities for Israel. The business, technology and defence relations with Asia that began under Netanyahu and expanded under former prime minister Bennett will continue to grow under the new government.