Israel Mulls Greenlighting New Sub Deal With Germany

The cabinet was supposed to vote Sunday on establishing the commission of inquiry on Israel's previous sub purchases from Germany but deferred it until the contract on the purchase of additional submarines is signed

Jonathan Lis
Jonathan Lis
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Demonstrators in Jerusalem carry an inflatable model of a sub.
Demonstrators in Jerusalem carry an inflatable model of a sub to highlight alleged corruption in the purchase of German submarines, Feb. 6, 2021.Credit: Ohad Zwigenberg
Jonathan Lis
Jonathan Lis

Israel’s ministerial committee on defense procurement held a deliberation on Sunday on the purchase of three additional submarines from Germany.

The official signing ceremony for the purchase is expected to take place this week, possibly on Wednesday, but the transaction has taken on greater importance in light of suspicions of corruption in Israel’s purchase of submarines and missile ships from Germany in the past.

A memorandum of understanding on the procurement of the three additional subs was signed between the two governments in 2017, but Berlin had expressed reservations about going through with the sale if it turned out that the prior purchase was tainted by criminal conduct. The memorandum on the new purchase included provisions permitting the Germans to withdraw from the deal if the suspicions on the prior purchases are borne out.

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But in her final days in office, German Chancellor Angela Merkel got involved in an effort to lay the ground for the purchase to proceed even after her successor, Olaf Scholz, took office in December. Once an agreement is signed, it would also be expected to pave the way for the Israeli cabinet to approve the convening of a state commission of inquiry into the prior submarine deal. Officials have said Germany has made it clear that despite prior statements, it would not act to rescind the new sale – even if an official investigation of the prior purchase is later found to have been tainted by corruption.

The so-called submarine affair involved two huge purchase agreements between Israel and the German shipbuilder ThyssenKrupp Marine Systems. One was for the purchase of three advanced submarines for 1.5 billion euros ($1.7 billion), and the other was a 430-million-euro transaction for missile ships to protect Israel’s offshore natural gas platforms.

Concern over the prospect that the new agreement and other defense procurement deals would be canceled led Prime Minister Naftali Bennett to oppose establishing a commission of inquiry until now. He also didn’t want to be seen as targeting opposition leader Benjamin Netanyahu in the affair, although the former prime minister has not been directly implicated in suspicions of criminal conduct in this case. Last week, sources close to Bennett said he had not yet decided whether to vote in favor of the commission of inquiry.

Defense Minister Benny Gantz and Foreign Minister Yair Lapid announced on Friday that they intended on bringing the establishment of the commission for approval at the cabinet meeting on Sunday, but it was deferred until the new submarine agreement with Germany is signed.

“Establishing a commission of inquiry is a necessary step in safeguarding Israel’s security. This is a national necessity,” Gantz said in a statement on Friday.

An Israel Navy submarine.Credit: IDF Spokesman

For his part, Lapid said, “We promised the Israeli public that we would not give up on investigating this scandal – and we have kept it. The submarine and warship affair is the most serious security corruption scandal in Israel’s history, and we will demand that no stone will be left unturned to achieve a fair investigation.”

Gantz said the commission of inquiry would examine the inner workings and decision-making of diplomats involved in the deal and deliver an opinion on current policy relating to warship and submarine purchases. The commission would not investigate the individuals already under indictment, however, and not issue findings relating to them. But the commission would examine the political leadership’s decision-making in the procurement process, Gantz said.

According to indictments filed in the case, senior military officers, government officials and people close to Netanyahu demanded and received bribes to promote the deals. Netanyahu has not been indicted in the case, and the main allegation against him involves his initiative to purchase additional submarines for the navy that the defense establishment opposed.

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