The Israeli Defense Ministry said an Israeli company has signed a memorandum of understanding with a state-owned Chinese corporation for a sensitive project without the Ministry's knowledge.
The Ministry said it was investigating the issue amid concern over possible US anger as Washington continues to exert pressure on the Israeli government to reduce the volume of Chinese investments.
Haaretz reported the deal on Wednesday, saying the Defense Ministry was not aware of the MoU.
The Defense Ministry contracted Israeli firm Airpark in 2019 to build a civilian aircraft manufacturing facility near the Israeli Air Force's Ovda base, in Israel's south.
The new project is meant to provide a variety of services in global civil aviation, such as upgrading aircraft and storage.
It turns out that Airpark later signed a memorandum of understanding with China's Comac, which is blacklisted by the United States.
The two companies are cooperating in various fields, and signed an agreement, in exchange for extensive remuneration, where the Chinese company will enjoy cooperation in the area of aviation as well as sharing information and advancement of technological and innovative projects that Israeli firms can offer.
The agreement includes cooperation with the Israel Air Force in operations and infrastructure, including civilian operation procedures, ground operations, training, and emergency procedures.
The United States sharply criticized Chinese involvement in Israel, especially the depth of economic cooperation which has become strategic.
The Pentagon has cautioned Tel Aviv about the expansion of Haifa Port by a Chinese company, considering it a violation of US security.
In closed-door meetings, US officials said that the Sixth Fleet would cease anchoring at the port over espionage concerns.
A security official told Haaretz that apart from the security risk posed by Comac’s involvement, possible damage to Israel's ties with the United States must also be considered.
“Such a decision requires a security assessment. The fact that the National Security Council and the Air Force were not familiar with the matter indicates possible gaps in the updating and approval processes by the relevant bodies of the construction of a civilian facility near a military base."
The official reported that the United States seeks to minimize its presence in the Middle East while reducing its economic dependence on China, and Washington will need the assistance of its partners.
However, he warned that if Chinese investments in Israel are left unaddressed, it could undermine the strategic partnership and endanger Tel Aviv's own economic dynamism and security.
