Israel is Definitely Not Being Isolated

January 9, 2015  

Israel’s splendid isolation
Despite the conventional claim that Israel is becoming increasingly isolated, the multinational accounting firm PricewaterhouseCoopers determined that 2014 was a record year of overseas investments in Israel’s high-tech industries: $15 billion in acquisitions of 52 Israeli startups (compared to $7.6 billion in 2013), in addition to $9.8 billion raised by 18 Israeli companies in overseas stock exchanges (compared to $1.2 billion in 2013). Once again, Israel’s impact on global medicine, health, agriculture, irrigation, energy alternatives, science, cyber, homeland security and defense, as well as Wall Street, outweighs the impact of the Gaza Strip.

But, Israel is becoming increasingly isolated.

Since 1948, a recycled assumption (e.g., the 1975 “Zionism is racism” U.N. resolution) has maintained that an anti-Israel global tsunami is about to drown the Jewish state, triggering unprecedented isolation, the collapse of its international standing and the breakdown of its ties with the U.S., unless it promised — in the unpredictable, unstable, violent Middle East — to redivide Jerusalem, uproot over 500,000 Jewish settlers, and retreat to a 9-15 mile sliver along the Mediterranean dominated by the mountain ridges of Judea and Samaria.

However, the collapse of the USSR (which facilitated the 1991 revocation of the USSR-sponsored “Zionism is Racism”), the affirmation of the U.S. as the dominant super power, the upgraded, mutually beneficial U.S.-Israel relationship and the emergence of Israel as a global commercial and military high tech power, have all enhanced Israel’s global standing, dramatically expanding Israel’s global networking beyond Europe into India, China, Russia, the former Muslim republics of the USSR, Latin America — all irrespective of diplomatic setbacks.

Thus, the Israel-India trade balance catapulted from $200 million in 1992 (following the 1991 establishment of diplomatic ties) to $5 billion in 2014. According to the January 3, 2015 issue of the London-based Qatari daily, Al Araby al Jadid, the substantial improvement in the attitudes of Africa and India toward Israel reflects the growing benefits they reap from Israel’s advanced civilian and military technologies. “The shift in India’s position will have an impact on the behavior of other countries. Technology has also played a key role in the development of relations between Israel and China, which is interested in Israel’s advanced technology to boost its economic capability, especially in industry and agriculture. … Israel’s advanced technology developments have boosted its diplomatic ties and enhanced its security.”

According to Bloomberg, Israeli exports to Asia have soared significantly, from 13 percent in 2000 to 23 percent in 2014, equaling exports to the U.S.

But, Israel is becoming increasingly isolated.

The Israel-China trade balance has surged from $51 million in 1992 to almost $11 billion in 2013, with China rising to become Israel’s second top export destination. Free trade agreement negotiations will be launched in 2015. On Dec. 4, 2014 the Wall Street Journal reported that Chinese investors had joined American, European and Russian investors who regularly visit Israel’s high tech parks in search for companies, startups and investments. Giant Chinese insurance group Ping An Insurance, which has already invested in eight Israeli startups, considers the U.S. and Israel as the two key arenas for venture investments. In 2011, ChemChina acquired Israel’s Adama, a pesticides manufacturer, for $2.4 billion. In 2013, China’s Fosun Pharma acquired Israel’s Alma Lasers for $240 million. In 2014, China’s Bright Food Group acquired a majority stake in Israel’s Tnuva Food Industries for $960 million.

But, Israel is becoming increasingly isolated.

The Israel-South Korea trade balance increased from $50 million in 1987 to $2.5 billion in 2014, highlighting the surging commercial and military ties, featuring global giant Samsung Electronics and its two research and development centers in Israel, and additional global South Korean companies such as Hyundai Corp., Daewoo International, Posco Engineering, LG Electronics, Korea Aerospace Industries, Huneed, Firstec, KIA Motors, etc. Japanese companies are, gradually, venturing into Israel; and Singapore-based funds have invested in Israel’s high tech, as demonstrated by Broad Peak Master Fund, which led a $15 million round of private placement in the Israel-Singapore Trax Technology. The Australia-based Allflex, the worldwide market leader in animal identification products, acquired the livestock monitoring and intelligent milking solutions Israeli company, SCR Engineers Ltd., for $250 million.

But, Israel is becoming increasingly isolated.

Israel has substantially expanded its commercial and military ties with the former Muslim republics of the USSR — Kazakhstan, Uzbekistan, Turkmenistan and Azerbaijan. According to the Begin-Sadat Center for Strategic Studies, “Over the last 20 years, the ties between Israel and Azerbaijan have improved drastically.” Israel receives reliable oil supplies from Azerbaijan, while supplying Azerbaijan with advanced weapon systems (e.g., unmanned aerial vehicles), counter-terrorism systems and training, vital intelligence on Islamic terrorism and medical, irrigation, agricultural and cyber technologies.

But, Israel is becoming increasingly isolated.

Bloomberg reported on December 9, 2014 that the European Union signaled interest in a possible pipeline to import Israeli offshore natural gas via Cyprus and Greece, in order to reduce reliance on Russia. There is also the possibility of exporting Israeli offshore natural gas through Turkey, which has been a vicious critic of Israel while simultaneously expanding it trade balance with the Jewish state: $5 billion in 2014, compared to $3.4 billion in 2009.

But, Israel is becoming increasingly isolated. … Or, not.

By ~ Yoram Ettinger

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