Foreign Correspondence

[Amaunet]

Israel to sell China security projects.

Maybe the thought of sitting around and waiting for the United States to disarm them while they are being converted to Christianity is unappealing.

I am not sure what Israel will sell China that has U.S. approval.

Israel had agreed to sell China the Phalcon AWACS but was forced to cancel the $1.2b. deal after enormous US pressure which did not want their Chinese rivals to have such a formidable radar system. Washington felt it would tip the balance against its ally Taiwan.

Unless Israel plans on working some deals without U.S. approval. -Am


China defense ties on the mend
By ARIEH O'SULLIVAN

Mar. 21, 2004 0:38 / Updated Mar. 21, 2004 1:06

A top-level Israeli delegation is currently visiting China in an effort to repave the way to lucrative defense deals with Beijing.

It was the first such visit since the two countries signed an agreement putting to rest the disagreement for the cancellation of a deal to sell Beijing the Phalcon advanced airborne radar system exactly two years ago.

Defense Ministry Director-General Amos Yaron said this week's trip was to thaw out the frosty relations since 2002.

"The Chinese are interested in continuing and strengthening the ties. Certainly there will be projects in the security realm. The Phalcon [cancellation] happened, and we all learned our lessons from it," Yaron was quoted as saying by defense officials.

Accompanying Yaron was Maj.-Gen. (ret.) Yossi Ben-Hanan, head of Sibat, the Foreign Defense Assistance and Defense Export Organization. Joining them was Yehiel Horev, the chief security officer in the Defense Ministry.

According to defense officials, they met with Chinese Defense Minister Cao Gangchuan and it was agreed to pursue further contacts.

The meeting came on the heels of Israel's successful sale of the Phalcon radar system to India just two weeks ago. That deal is worth $1.1 billion and will greatly boost India's air power. India and China share a common border.

Israel had agreed to sell China the Phalcon AWACS but was forced to cancel the $1.2b. deal after enormous US pressure which did not want their Chinese rivals to have such a formidable radar system. Washington felt it would tip the balance against its ally Taiwan.

Israel ended up paying $350 million in compensation, losing not only the deal but causing a freeze in what had been a very lucrative arms market and damaged the reputation of the country's defense exports. The Israeli defense industries subsequently forged flourishing ties with New Delhi, albeit this time with Washington's prior approval.

Israel's defense ties with China go back to the late 1970s, way before diplomatic relations were established in 1992.



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