The involvement of foreign companies in strategic infrastructure in Israel is a complex economic-security issue that has recently been a subject of discussion between Israel and the United States. The regulation model for the Israeli electricity sector demonstrates how the influence of a single party on the country’s strategic infrastructure can be limited, be the party local or foreign. Decentralizing control and privatizing peripheral and operational infrastructure elements, while keeping the core of management and the other...
The United States is intensifying its pressure on allies not to install Chinese 5G communications infrastructure and may punish those that ignore its warning. At the same time, Huawei is at the center of political turmoil around the world, and some cellular providers have chosen Western alternatives rather than waiting for decisions by their governments about the use of Chinese technology. Although the Israeli government has not made any official pronouncement on this matter, the likelihood that Israeli 5G infrastructure will include...
The Ministry of Defense and the Ministry of Finance are preparing the next defense budget, which is especially challenging in light of the current economic crisis. In this budget, similar to past budgets, there will likely be a notable absence of the direct costs of wars or large military campaigns liable to occur. In practice the Defense and Finance Ministries calculate such costs in retrospect, and only then do they explore funding sources. This article examines this issue and concludes that the costs of war and resulting damage to...
IDE Technologies, which specializes in water treatment solutions, won the bid for construction and operation of the Soreq 2 desalination plant. According to a May 24, 2020 Finance Ministry statement, the Israeli company was chosen over Hong Kong-based Hutchison on the basis of pricing considerations. The media, however, cast the decision as accession to a demand by the United States relayed during the recent visit to Israel by Secretary of State Mike Pompeo, who warned against Chinese involvement in infrastructures. Despite the sense...
The current economic crisis in the Gulf states stems from the consequences of the coronavirus pandemic on both the local and global economies, including the sharp drop in oil prices. This article examines how these states are contending with the crisis. Among the dilemmas facing the regimes: the extent to which the “contract” that guarantees overall welfare to the public can be compromised without upsetting stability; the extent to which employment of foreign workers can be curbed without harming economic performance; and...
The Palestinian Authority’s efficient and rapid response to the coronavirus outbreak underscored the Gordian knot tying it to Israel in matters of geography, economy, civilian affairs, security, and health. Israel’s new government would do well to recognize this, and consider the PA’s stable and effective performance as a critical component of Israeli national security. The ability of the PA to advance economic growth in the West Bank is a central component of this Israeli interest.
The global, regional, and internal implications of the coronavirus are still not fully clear, but Israel’s 35th government will have no 100-day grace period. It must quickly restore the economy to full activity, despite the presence of the virus and the possibility of a renewed outbreak. On the security level, all the regimes in the Middle East are busy with the pandemic and internal affairs, and will most likely seek to avoid escalation in conflicts with Israel. At the same time, the risk of unplanned escalation (in Syria,...
On Thursday, April 23, 2020, INSS conducted a second simulation of a “Corona Cabinet.” The discussion dealt with the exit strategy from the crisis and the steps that should be taken to return Israel’s economy and society to their routine. The principal insights that emerged from the simulation include the need to integrate management of the healthcare, economic, and social risks; an understanding of how the “Corona Cabinet” should operate and the need to establish a professional “corona staff”; the importance of differentiation as an...
Even if there is an effective medical response to the coronavirus soon, it will take many months, or even years, before the Middle East emerges from the economic crisis that has afflicted it and other regions since early 2020. The coronavirus crisis is in effect the new calamity following the decade of the “Arab Spring,” which severely undermined political and economic stability in a number of countries in the region and left 10 million refugees, mainly in Syria, Jordan, Lebanon, and Turkey. Israel is capable of handling its own...
The understandings led by the United States, Russia, and Saudi Arabia to cut oil production are the principal multilateral measure aimed at stabilizing the global economy during the coronavirus crisis. It is expected to revive OPEC+ and build the initial infrastructure for strengthening the cartel’s influence on the entire energy market. Despite the conflicting interests of the respective parties and the loose nature of the agreement, the common economic distress should help to maintain compliance in the coming months. If the...
The current phase of Israel’s battle against the coronavirus focuses on curbing the spread of the pandemic and “flattening the curve” of serious illness, to prevent overloading the health service—which could lead to its collapse and to very high mortality levels. Like the thinking underlying Israel’s national security concept, the defensive alone will not lead to victory. The policy proposed here is based on three principles that differentiate it from the policy of the containment phase: (a) The main effort will move from containing...
Following the containment stage of the corona pandemic, Israel will be called upon to launch an economic and social recovery. That stage must be based on differential, nonlinear, and flexible management of the “emergency routine,” while gradually expanding functional continuity according to the sectors and population groups who from a health perspective can return to work, even if in limited format. While this policy incurs many risks, including a descent into uncontrolled infection, intelligent management through precise planning,...
