STRATEGIC ASSETS AND NATIONAL SECURITY IMPERATIVES: THE CASE OF CHINESE INVESTMENT IN ISRAEL

This article analyzes the implications of states’ decision to grant the right of operating their strategic assets to foreign entities. As defined in this article, strategic assets consist of possessions such as transportation and communications systems, which are vital for the functioning of a population in a given geographical space. Given the critical importance of strategic assets, it is a controversial choice by leaders to grant the right to operate them to foreign firms, which may have motivations beyond economic considerations. Foreign firms, for example, may engage in malign acts such as stealing information of vital importance or monitoring the activities of the institutions of the host state. In addressing the question of under what conditions states may allow foreign investors to administer their strategic possessions, this work will take China’s investment activities in Israel as its case study, specifically focusing on China’s acquisition of the right to operate Israel’s strategic Haifa port. By way of conclusion, China’s investment activities in Israel show that threat perception and level of political relations are crucial determinants in foreign entities’ ability to secure strategic tenders abroad.