The Trump effect: No longer just rockets from Gaza, but now also a hit to the local economy, as high-tech delegations from Japan and China canceled Thursday their trips to Israel following U.S. President Donald Trump's recognition of Jerusalem as Israel's capital.
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The Chinese Embassy has issued a formal travel warning, valid until January 10, 2018. China is concerned about the security situation following Trump's announcement, and expects the conflict to impact its investment programs in Israel.
On Saturday morning, a number of Israeli startups were notified that Shen Haiyin, CEO and founder of the Chinese company Singulato currently developing a miniature electric car, had cancelled his visit just six hours before his flight. Shen was supposed to arrive for a series of meetings with Israeli high-tech companies.
A delegation from Tencent, China’s largest internet company, also cancled their expected visit.
The situation is expected to worsen, as cancellations are not limited only to China. TheMarker was also notified that the Japanese company Toyota's Fund also canceled its trip to Israel, which had been scheduled for Sunday.
According to estimates, 10-20% of capital for Israel's high-tech sector comes from China.
China's increased interest in Israel is primarily based China's desire to shift its economic structure and transition from pollutant-heavy industry to a modern tech-driven economy. Severe air and food pollution in China, and the strength of social networking sites in the country, have sparked interest in mobile, internet, water, agricultural and advanced manufacturing technologies. Israel, which is popularly recognized as an innovative and technologically advanced country including in water and agricultural technology, answers these needs.
Clashes erupted for the third day running Saturday between Palestinian protesters and Israeli soldiers following Trump's recognition of Jerusalem as Israel's capital. Trump delivered a landmark speech in Washington Wednesday, recognizing Jerusalem as the capital of Israel. As expected, Prime Minister Benjamin Netanyahu welcomed the announcement, while Palestinian President Mahmoud Abbas declared that the U.S. can no longer act as a mediator between Israel and the Palestinians.