Israel plans leasing Negev land to Chinese investors

Uri Ariel Photo: Rafi Kotz

Agriculture Minister Uri Ariel wants to lease 250,000 acres for 21 years to grow produce for the Chinese market.

The Ministry of Agriculture and Rural Development is promoting a new plan by Minister Uri Ariel and director general Shlomo Ben Eliyahu for cooperation with governmental agencies and business concerns in China. The plan includes a large allocation of land in Israel for growing crops for the Chinese market.

The Chinese government's global policy is paying particular attention to nutritional security and food supplies, (in addition to taking over mines and energy all over the world, mainly in Africa). While China is taking care of its nutritional security, however, such a venture is liable to detract from food security for Israelis, because some of the land to be allocated to the Chinese is currently used to grow wheat for the Israeli economy.

The idea for cooperation in the agricultural venture was raised during Ben Eliyahu's visit to China two weeks ago, during which he held a series of talks with senior staff at the Chinese Ministry of Agriculture in Beijing, Chinese government companies, and business concerns. In addition to crops, the Israeli Ministry of Agriculture is offering China know-how and technology in the dairy sector and construction of sophisticated cowsheds, as was also offered to Russia.

Under the plan, which Ben Eliyahu calls "the million dunam project," hundreds of thousands to one million dunam (250,000 acres) of unirrigated land will be allocated, mainly in the Negev and the Arava.

The allocation of such large amounts of land for the venture will be at the expense of land used to grow grass for animal feed and produce silage, for example lucerne, which will damage the dairy sector, possibly resulting in a definite increase in prices of dairy products.

Premium agricultural products

The land to be allocated is not an integral part of the land held by kibbutzim (collective communities) and moshavim (cooperative communities); it is leased to the communities under special contracts. When such land is leased to private agribusiness concerns, it is under three-year contracts with an extension option.

The initiative includes a substantial change in the agricultural land leasing regime. Available land that has hitherto been leased under short-term contracts will be leased for to farmers taking part in the venture under 21-year leases with a 21-year extension option in order to provide business security and stability for the lessees.

According to the plan, the land will be used to grow premium crops, which Chinese concerns will undertake to buy in advance. This involves mainly avocado, which has a relatively long shelf life that facilitates marine transportation, and which is sold at especially high prices in Chinese markets.

The venture involves Chinese financing of the irrigation costs of the avocado farms. Two desalination facilities will be built in the Mediterranean Sea to supply water for irrigating these areas. Another possibility mentioned is Chinese participation in the Red Sea-Dead Sea Canal, together with Israel and Jordan, and use of the desalinated water from the canal for the agricultural enterprise.

Agricultural sector sources expressed astonishment about several aspects of the initiative. First of all, the exclusive use of desalinated water for irrigating the farms, given the forecast of prolonged drought, especially in the Negev, casts doubt on the economic viability of such a venture.

Secondly, 100,000 dunam (25,000 acres) of the areas allocated to the venture is liable to come from land currently used to grow wheat (90% of the wheat consumed in Israel is imported from various countries). Giving up this area detracts from the principle of ensuring a supply of food for Israel.

Another point raised by the critics is that an absolute change in the regime for leasing available agricultural land form short-term to long-term leases deprives Israeli of flexibility in the use of its land.

"A crop sale deal"

The Ministry of Agriculture and Rural Development said, "The facts are that no problem of food security of fresh produce - fruits and vegetables - exists. Israeli farmers supply all of Israel's consumption of fruits and vegetables, other than isolated cases. On the contrary; there is a surplus of fresh agricultural produce - fruits and vegetables marketed for export. One third of the agricultural land is used to grow produce that is not designed to maintain food security.

"The transaction in question is like any sale of fresh agricultural produce for export. The difference between this deal and similar deals in the sector is that it is a long-term deal aimed at providing agricultural certainty. Any exporter in any sector would be glad to make such a deal.

"The deal does not involve land; it is a sale of agricultural produce. The Israel Land Authority director general participated in the discussions in China, following the discussions that took place in the Eran Nitzan committee, which debated leasing the land on which the farmers grow their produce for a long period, rather than the short period in the current practice. Today, the contract for the land is valid for three years, and must be renewed every three years in order to meet the obligations undertaken in a long-term deal. It therefore follows that the land will be worked by Israeli farmers, not Chinese farmers."

Concern about damage to Mediterranean Sea water

The idea of building additional desalination facilities on the Mediterranean shore in order to irrigate a huge agricultural venture is arousing concern among environmentalists about the future of the Mediterranean. The Mediterranean Sea is a relatively small sea ringed by countries suffering from desertification, inadequate rainfall, and population density. A large number of desalination facilities on its shores is liable to damage it, because the salination created in the desalination process is put back into the sea, thereby increasing the natural saltiness of the water.

"The seacoast in Israel is only 197 kilometers long," says Zalul campaign manager Dalia Tal. "Today, three desalination facilities are operating along the coast in order to provide drinking water. It is already clear that additional facilities are needed, due to the increasing frequency of drought and lack of rain, especially in northern Israel. The Israel Water Authority is therefore already planning to double the Sorek desalination plant in order to send water to Lake Kinneret (the Sea of Galilee, M.L.), from where water is also sent to Jordan, another country suffering from a severe water shortage.

"The desalination facility takes up valuable coastal space, causes air pollution, and increases the salinity of seawater, the results of which are still unknown. One indication of this is the objections to the building a desalination facility in the western Galilee. These facts should be taken into account before Israel decides again to export the valuable water of which we have a shortage."

Published by Globes [online], Israel Business News - - on December 25, 2017

© Copyright of Globes Publisher Itonut (1983) Ltd. 2017

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Uri Ariel Photo: Rafi Kotz
Uri Ariel Photo: Rafi Kotz
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