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Former White House Coordinator for Arms Control and WMD Terrorism

Israeli Arms Exports to China of Growing Concern to U.S.

Wade Boese

The United States has reportedly increased pressure on Israel about its arms sales to China, and Israel has given assurances that it will not export any item that could harm U.S. security, according to U.S. and Israeli officials in January.

U.S. concerns about Israeli arms sales to China have existed for more than a decade and came to a head in July 2000 when the United States persuaded Israel to cancel the sale of the Phalcon, an advanced, airborne early-warning system, to China. Afterward, U.S.-Israeli differences over arms sales to China publicly receded but resurfaced in early January when the Israeli newspaper Ha’aretz reported that the United States had recently asked Israel to end all arms sales to China.

U.S. and Israeli officials have not publicly confirmed whether the United States made such a request, but State Department spokesman Richard Boucher suggested that the Israeli-Chinese arms trade is a continuing problem. He said January 2 that it is an “ongoing subject of discussion” between the United States and Israel. He further stated that the subject “comes up regularly” and there is a “need for any suppliers of weaponry to be considerate and concerned about the strategic situation in a region that’s of great sensitivity and importance to us.” The United States is a strong supporter of Taiwan, which Beijing is seeking to reunify with the Chinese mainland.

China, according to the Associated Press, issued a written statement January 3 declaring, “No country has the right to interfere in the developing military trade cooperation between China and Israel.”

When asked whether Israel had halted all arms sales to China, a spokesperson for the Israeli Defense Ministry replied January 8, “Defense relations between Israel and China require from time to time consideration of specific issues. This revision [sic] is conducted vis-à-vis China and on concrete issues also vis-à-vis the U.S., bearing in mind American sensitivity.”

Another Israeli official, who asked to remain anonymous, explained in an interview January 8 that Israel is committed to refraining from exports that would harm U.S. security. The official suggested, however, that Israel would continue to sell some military equipment to China that is readily available on the global arms market.

One nongovernmental expert in Washington familiar with the issue, who also wished to remain anonymous, said his impression is that the United States is seeking to curtail Israeli arms sales to China to the greatest extent possible, while Israel is seeking minimum restraint on its exports.

The largest recipient of U.S. aid, Israel first approached China about possible arms deals in 1979, reportedly hoping to win some Chinese restraint in arms sales to Israel’s neighbors and enemies.

The United States has reportedly increased pressure on Israel about its arms sales to China, and Israel has given assurances that it will not export any item that could harm U.S. security...

U.S.-Israeli Policy for Exporting Arrow Missile Undecided

September 2002

By Wade Boese

Top U.S. government officials testified in July that the Bush administration has not yet formulated a policy about the possible export of a joint U.S.-Israeli theater missile defense system, the Arrow, to India or any other country.

The absence of a formal U.S. Arrow export policy came to light when Secretary of Defense Donald Rumsfeld told senators at a July 25 Armed Services Committee hearing that the administration did not have a “view” about India buying the Arrow system. Two days earlier, The Washington Post had reported on a proposed Israeli Arrow sale to India, the export of which would need U.S. approval because Arrow incorporates U.S. technology.

Appearing before a subcommittee hearing of the Senate Governmental Affairs Committee July 29, Deputy Assistant Secretary of State Vann Van Diepen and Deputy Assistant Secretary of Defense Marshall Billingslea broadened Rumsfeld’s statement, explaining that Washington had no position on Arrow exports in general.

Van Diepen informed senators that Arrow is classified as a Category I system under the Missile Technology Control Regime (MTCR), which is a voluntary arrangement of 33 countries, including the United States, aimed at preventing the spread of missiles and related technologies capable of carrying a 500-kilogram payload at least 300 kilometers. MTCR members are expected to maintain a strong presumption of denial on exports of Category I items, which include whole missiles or major subsystems such as rocket engines.

The presumption of denial, however, is not a ban. Members are to weigh five criteria set out in the MTCR guidelines when considering a Category I export. Those criteria include, among other things, evaluating the importer’s intentions for using the export and whether it poses a potential proliferation risk. The United States has made past Category I exports, shipping Tomahawk and Trident missiles to the United Kingdom and transferring items to European and Japanese space launch programs.

Van Diepen cautioned that Washington needs to be wary about what kind of precedent others might draw from future U.S. exports. Earlier U.S. Category I exports were made to close allies or were destined for nonmilitary use, whereas sending the Arrow to an unstable region with nuclear-armed adversaries would be qualitatively different. “It’s going to be hard for us potentially to say no to a Russian export of Category I rocket technology to Iran,” Van Diepen said, if the United States is making similar kinds of exports.

Billingslea appeared more inclined toward permitting Arrow exports, commenting that the Pentagon believed missile defenses are “inherently stabilizing” and that the United States should explore protection against missiles with both India and Pakistan. Nevertheless, Billingslea added that no conclusion existed about how to balance MTCR obligations with foreign defense cooperation.

Although not specifically indicating whether New Delhi had contacted Washington about the missile defense system, Billingslea suggested that India had not officially requested Arrow. “We also need to hear from the Indians in terms of what they need, what they want, what kind of missile defense systems do they want to have, and for what ends,” he said.

An Israeli official interviewed August 20 denied that Israel is pushing to export the Arrow now. The official remarked that Israel believes that it is logical to make Arrow available to allies and friendly countries but that current tensions in South Asia warrant caution.

Moreover, the official said Israel is focused on producing Arrow for itself with the prospect of war with Iraq looming, rather than shipping missiles to others. Israel is currently finalizing deployment of its second Arrow battery and is aiming to field a third.

Not all theater missile defense systems would necessarily be classified as a Category I item. The U.S. Patriot system is not, and Washington has exported different versions of that missile system to several countries.

U.S.-Israeli Policy for Exporting Arrow Missile Undecided

Europeans Scrutinize Arms Sales to Israel

May 2002

In April, European legislators called for an arms embargo on Israel because of its military operation launched March 29 in the Palestinian West Bank. European governments have yet to act officially, although some, such as Germany and the United Kingdom, are looking at Israeli arms requests with greater scrutiny, effectively slowing or suspending arms deals with the Jewish state.

No European arms embargos have been imposed on Israel, although the European Parliament of the 15-nation European Union and the Parliamentary Assembly of the 44-nation Council of Europe—a negotiating forum founded in 1949 to protect human rights, democracy, and the rule of law in Europe—have recommended imposing an arms embargo on Israel in separate April votes.

An Israeli official said certain arms requests are not being acted on at their normal pace and that “some things are taking their time.” The official declined to go into further detail.

Although not taking formal action to cut off arms supplies to Israel, Germany has put off making a decision on whether to deliver spare tank parts requested by Israel. German export law restricts selling arms to regions in conflict.

The United Kingdom is now looking more closely at Israeli arms exports because London contests that it can no longer trust Israeli assurances that U.K.-supplied weapons will not be used in ways to which it objects. Israel agreed in November 2000 that British arms would not be used in the Israeli-occupied Palestinian territories, but London revealed March 11 that it had determined Israel used converted U.K. tanks contrary to that agreement.

The United States, the largest arms supplier to Israel, has not suggested that U.S. sales to the country are in any jeopardy. The 1976 Arms Export Control Act, which governs U.S. arms transfers, states that U.S.-supplied weapons are to be used by the recipient for self-defense and internal security purposes. The Israeli official said U.S. officials have not called into question Israeli use of U.S.-supplied arms.

Appearing April 21 on NBC’s Meet the Press, Secretary of State Colin Powell said the United States is not considering cutting off any aid to Israel. Israel, which received roughly $2 billion in U.S. military aid this fiscal year, is the largest recipient of U.S. Foreign Military Financing grants, which the country uses to purchase U.S. weaponry as well as weapons produced by its own arms industry.

In April, European legislators called for an arms embargo on Israel...

Israel Cancels Radar Deal With China

Israeli Prime Minister Ariel Sharon sent a letter in July to Chinese President Jiang Zemin informing him that Israel would not reconsider its decision to halt the sale of a sophisticated radar system to Beijing. Israel will begin negotiations with China in the “near future” on how to compensate China for the cancelled contract, Israeli Ministry of Defense spokesman Shlomo Dror said during an August 28 interview.

In July 2000, under pressure from the United States, then-Israeli Prime Minister Ehud Barak stopped the sale of the radar system, known as the Phalcon. Chinese acquisition of the system would have given Beijing its first advanced airborne early-warning capability, which the United States feared could help tip the Taiwan Strait military balance in China’s favor.

But Barak did not actually cancel the deal. Instead, an Israeli spokesperson said that Israel would “continue to look for ways to implement the deal in understanding with the United States if the circumstances…change.” The Bush administration, however, rebuffed the idea of reversing U.S. opposition when Israeli officials broached the issue, leading Sharon to send his letter.

Sharon’s letter expressed “regret” for having to cancel the deal, Dror said. The spokesman added that Israel wants to maintain good relations with China and still considers U.S. opposition to the sale a “mistake” because it thinks Beijing will obtain a similar capability from another supplier, such as Russia or France, or will develop comparable technology on its own.

Israel Plans to Buy U.S. F-16 Fighters

Amid displays of some of the most advanced weaponry available on the international arms market, Israeli government officials at the Paris Air Show notified U.S. aerospace manufacturer Lockheed Martin on June 19 that Israel would buy at least another 50 F-16I combat aircraft later this decade. Israel is exercising an option from a January 2000 contract, worth $2.5 billion for 50 F-16I fighters, that stipulated Israel could purchase up to an additional 60 fighters for an extra $2 billion.

The potential sale is unlikely to run into major hurdles even though the Israeli use of previously supplied U.S. F-16s to strike Palestinian targets May 18 upset some in the U.S. Congress. During a June 3 interview with CNN, Secretary of State Colin Powell indicated that Washington would prefer not to see U.S.-supplied weaponry used against the Palestinians.

At the request of Representative John Conyers (D-MI), the U.S. General Accounting Office is conducting a review of the terms and conditions of U.S. government arms sales to countries in the Middle East. Conyers is seeking to determine whether terms attached to earlier U.S. weapons sales to Israel would rule out their use against Palestinians, and whether Israel violated these terms in its May bombings.

For the option from the January 2000 deal to be exercised, the United States must negotiate a contract with Israel for the purchase of the additional 50 fighters. If a deal is reached, Israel will start taking delivery of the second batch of fighters in 2006 after the first 50 have been delivered, a process that will begin in 2003. Israel currently has approximately 250 F-16s and 100 F-15 combat aircraft supplied by the United States in service.

F-22 Raptor Sale to Israel Supported by Clinton

In an open letter to the Israeli people sent January 19, departing President Bill Clinton wrote he would support the future sale of the F-22 Raptor combat aircraft to Israel, pledging that he would recommend that Israel be "among the first, if not the first, foreign customer." Clinton's pledge, however, is not binding on President George W. Bush and is largely perceived as a symbolic gesture underscoring the U.S. commitment to maintain Israel's "qualitative" military edge in the Middle East.

Still in the development stage, the F-22 is slated to replace the F-15 as the next U.S. air superiority fighter, but the fighter's high cost, estimated at least $180 million per plane, has raised doubts whether the United States will even procure the stealth fighter. Air Force plans call for purchasing a total of 341 Raptors, but the new Bush administration has effectively put all major acquisition programs on hold until the new secretary of defense, Donald Rumsfeld, completes a "top to bottom" review of the U.S. military, which is expected to take months. Nevertheless, an Israeli official welcomed the Clinton letter as a "positive statement."

The outgoing Clinton administration also signed a memorandum of understanding with Israel on January 19 spelling out the unofficial U.S. policy since 1998 of phasing out U.S. economic assistance to Israel by $120 million per year until it is eliminated in 2008. In exchange, the United States has been increasing its military aid to Israel by $60 million per year until it reaches $2.4 billion annually by 2008. Previously, U.S. annual aid to Israel consisted of $1.2 billion in economic assistance and $1.8 billion in military assistance. Like the F-22 pledge, the memorandum is not binding on Bush.

In January 2000, Israel signed a $2.5 billion contract for 50 F-16C/D fighters, with deliveries to begin in 2003. The contract also included an option to buy another 60 fighters for an additional $2 billion, which Israel is currently evaluating. At this time, Israel's air force flies approximately 250 F-16 and 100 F-15 combat aircraft received from the United States.

Israel Declares Arrow System Operational

November 2000

On October 17, the Israel Defense Forces (IDF) declared the Arrow-2 theater ballistic missile defense system operational. The IDF announcement did not further explain the move, but an Israeli official said it could be viewed as a "response to the current situation."

Arab-Israeli tensions have been heightened since the outbreak of Israeli-Palestinian violence following the September 28 visit of right-wing Likud leader Ariel Sharon to a sacred, but controversial, site in Jerusalem. Iraq, which has threatened Israel since the latest round of violence started, launched Scud missiles at Israel during the 1991 Persian Gulf War.

Israel's air force assumed command of the first of three planned Arrow batteries in March and held the first successful test against an incoming target on September 14. (See ACT, October 2000.) The Israeli official commented that the system is now "ready to do what it was designed to do," which is to intercept theater ballistic missiles. Though declared operational, testing of the system will continue and improvements will be made, according to the official, who pointed out that the system is still new.

Jointly developed by the United States and Israel starting in 1988, the Arrow employs a blast fragmentation warhead to destroy incoming targets rather than the hit-to-kill technology being pursued in U.S. systems. Total costs for the system are estimated to reach $2.2 billion by 2010. The United States has contributed approximately $600 million to the effort.

Israel Declares Arrow System Operational

Israel Achieves First Head-On Arrow Intercept

October 2000

Israel moved closer to declaring its Arrow-2 anti-ballistic missile system operational with a successful September 14 intercept of a target launched from an Israeli F-15 fighter aircraft. This marked the first test in which the defense system destroyed an incoming target flying directly toward Israel; previously, both the target and the Arrow missile were fired over the Mediterranean Sea because of range limitations stemming from Israel's small size. The test, for the first time, also featured the Black Sparrow missile target, designed to replicate a Scud target and to fly a Scud trajectory. System testing will continue even after the defense is officially declared operational, which may happen within the next few months.

Unlike similar U.S. theater ballistic missile defense systems that use a kinetic warhead to destroy an incoming target by collision, the Arrow-2 missile carries a blast fragmentation warhead. While reducing the necessity for a direct hit to achieve an intercept, the explosive warhead lessens the certainty that an incoming target will be completely destroyed. An analysis is underway to determine whether the Arrow-2 missile actually collided with the Black Sparrow target in the September 14 test.

The September intercept was the first test since the Israeli air force assumed command of the initial Arrow battery in March. Eventually, Israel plans to deploy three of the mobile batteries to protect its territory.

Israel started work on theater ballistic missile defenses in 1986 and began cooperating with the United States on the Arrow project in 1988. The system is expected to cost $1.6 billion through 2005 with Washington picking up approximately $600 million of the tab. By 2010, Arrow costs are estimated to total $2.2 billion.

Israel Achieves First Head-On Arrow Intercept

Israel Halts Chinese Phalcon Deal

Wade Boese

Aiming to end a prolonged public dispute with Washington, Israeli Prime Minister Ehud Barak told President Bill Clinton on July 11, the first day of a U.S.-brokered Middle East peace summit, that Israel would not complete a 1996 deal that would have given China its first advanced airborne early-warning (AEW) capability. Although upsetting China, the Israeli cancellation averted U.S. congressional threats to withhold aid to Israel if the AEW deal went forward. Washington and Tel Aviv are now holding high-level talks on strengthening their "strategic relationship" and avoiding similar future conflicts.

The United States went public last fall with its long-held opposition to the estimated $1 billion deal for four Phalcon radar systems when the first Russian-supplied plane destined for China arrived in Israel to be outfitted with the system. Designed to provide simultaneous long-range tracking of multiple air and surface targets, the Phalcon radar system, according to U.S. government officials, could impact the Taiwan Strait military balance in China's favor.

Citing the "need to help intimate relations" with the United States during and after the summit, Israel, the largest recipient of U.S. foreign assistance, publicly announced on July 12 that it would stop implementation of the Phalcon deal. The announcement emphasized that Israel considered itself to be "together with the United States in the midst of an effort to achieve historic decisions which are related to [Israel's] vital interests." While the summit ended July 25 without a negotiated settlement between Israel and the Palestinians, reported Israeli expectations are that if a future peace deal is concluded with the Palestinians or Syria, the United States will provide significant military and financial assistance to Israel.

In announcing the cancellation, Israeli spokesman Gadi Baltiansky stated Israel would "continue to look for ways to implement the [Phalcon] deal" if circumstances changed. However, U.S. congressional and administration sources, as well as an Israeli official with close knowledge of the issue, said the deal is off. The Israeli official noted that "no one" expects circumstances to change in the short or medium term.

Barak resisted U.S. calls earlier this year, even in personal meetings with Clinton and Defense Secretary William Cohen, to void the sale. (See ACT, May 2000.) Describing the final decision as "difficult," the Israeli official pointed to a combination of Cohen's April 3 visit, when he forcefully voiced U.S. concerns, and rising opposition by U.S. Congress members, including long-time Israel supporters, as turning points in Israeli thinking on the issue.

Senate Majority Leader Trent Lott (R-MS) and four other senior senators sent a bipartisan April 6 letter to Barak expressing their "deep concerns" with Israel's military cooperation with China and warned it could negatively affect U.S.-Israeli relations. The senators implied that Israel would risk the potential "multi-billion dollar U.S. aid package" being discussed as part of a possible peace agreement with Syria if the Phalcon deal went forward.

Representative Sonny Callahan (R-AL), chairman of the House Appropriations Subcommittee on Foreign Operations, Export Financing and Related Programs, proposed legislation to hold back Israeli aid worth $250 million—the value of one Phalcon system—unless the Pentagon certified that the deal did not pose a threat to U.S. national security. Clinton requested a total of $2.82 billion in U.S. aid for Israel over the next fiscal year.

Senate Foreign Relations Committee Chairman Jesse Helms (R-NC) also filed, but never officially introduced, the Callahan language on the Senate side. Helms, according to one of his spokesmen, "expected more from an ally than to provide this type of weapon system to a potential adversary." Remarks by Israeli Deputy Defense Minister Ephraim Sneh in mid-June suggesting Israel could cut imports from the United States if Washington cut aid had further raised Helms' ire.

Callahan dropped his legislation after Israeli Ambassador David Ivry informed the congressman of Israel's decision to stop the sale. Speaking to the House that day, Callahan called the cancellation a "tremendous step in the right direction." Helms' spokesman described the senator as "greatly relieved" by Israel's decision.

Barak, according to Baltiansky, expressed his "sorrow" by letter to Chinese President Jiang Zemin for Israel's cancellation of the deal and reassured him that Israel attached "great importance to her relations with China." Israel started marketing arms to China in 1979.

A Chinese foreign ministry spokesman said July 13 that the deal should be "honored" and that no other country should interfere in Chinese relations with other states. Later that day, Cohen, who was in Beijing when Israel announced its plan, said Jiang raised the issue as one of "concern." Cohen acknowledged U.S. opposition to the sale, but denied it reflected any attempt to "contain China."

Clinton announced July 27 that the United States would conduct a "comprehensive review" to improve U.S.-Israeli relations, including the maintenance of Israel's "qualitative edge" and the modernization of the Israeli military. Although State Department officials would not comment on the talks, the first round of which took place August 7 to 9 in Washington, they reportedly included discussions of Israel vetting with the United States arms sales to specific countries—China, India, Pakistan, and Russia.

THEL Test a Success

July/August 2000

Under development for nearly four years, the joint U.S.-Israeli Tactical High Energy Laser (THEL) destroyed an in-flight, short-range Katyusha rocket for the first time during a June 6 test. Although Lieutenant General John Costello, commanding general of the U.S. Army Space and Missile Defense Command, hailed the test as turning "science fiction into reality," the laser must still undergo several more tests, including tests against multiple rockets, before being shipped to Israel later this year, as currently planned.

Stemming from an April 1996 commitment from President Bill Clinton to then-Israeli Prime Minister Shimon Peres to help defend northern Israeli cities from terrorist attacks, THEL is a high-energy chemical laser designed to shoot down short-range rockets. In the June 6 test, THEL identified, tracked, and shot down the Katyusha rocket, which was traveling at about a speed of Mach 1, without any preprogrammed information on the rocket's trajectory or outside guidance. The effective range of the laser is classified, and its operational performance is susceptible to environmental factors, such as wind, rain, and fog.

At present, Israel only intends to take delivery of the current THEL demonstrator, while the United States has no plans to acquire the system, which Pentagon officials say is not mobile enough for U.S. defense needs. However, a U.S. Army Space and Missile Defense Command spokesperson remarked that the "THEL success demonstrates that high-energy lasers do have the potential for meeting the Army's need" for defenses against rockets, mortars, and artillery. The current program is expected to total more than $250 million dollars, including an Israeli contribution of $67.5 million.

THEL Test a Success


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