Israel Hands Foreign Home Builders Licenses in Bid to Ease Housing Shortage

Israel's government is counting on overseas companies to accelerate the pace of housing construction

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A Chinese construction worker in Tel Aviv. Last year, Chinese workers earned an average monthly salary of 24,000 shekels ($6,220).
A Chinese construction worker in Tel Aviv. Last year, Chinese workers earned an average monthly salary of 24,000 shekels ($6,220).Credit: Tomer Appelbaum

The Construction and Housing Ministry has awarded licenses to three of the six foreign construction companies it approved last year, in a bid to reduce prices and ease the housing shortage by accelerate the pace of building.

The ministry said Monday that the three were negotiating with Israeli developers to serve as subcontractors on residential projects, adding that they would begin Israeli operations over the next few months.

The first license was awarded on Thursday to Jiangsu Nantong No. 2 Construction Engineering Company, a Chinese mammoth that also operates in Singapore and Canada. The company’s tens of thousands of employees include over 3,000 construction engineers.

“The scope of the company’s operations, its experience and collaboration with Israeli partners will have a multiplier effect on the industry both in terms of the capacity to build and in bringing to Israel new technology and the most advanced construction methods,” said Construction Minster Yoav Galant.

The second company was Jiangsu Shuntong Construction, which didn’t make the cut when Israel approved the first six companies to operate in Israel. But it was one of two firms that joined the approved list when two of the original winners were disqualified. It is a privately controlled company with 18,000 employees and annual sales of $1.4 billion.

The third company was Beijing Construction Engineering Group, a state-owned corporation with an annual turnover of $2 billion and building projects in China, the United States, Australia and Africa. Eliran Dubjinsky, BCEG’s agent in Israel, said he was in talks for a first project in Israel that would employ 100 Chinese BCEG workers.

The Construction Ministry said three of the other six foreign builders — two from China and one from Portugal — were expected to receive their licenses by August 17.

The companies are coming to Israel with a plan to bring in as many as 20,000 Chinese construction workers, after the two countries reached an agreement in March over employment terms. The 20,000 Chinese nationals, 6,000 of whom are expected to arrive by the end of the year, will be employed by local companies.