Knesset Economic Affairs Committee chairman MK Avishai Braverman on Tuesday called on the Israeli public to protest the possible sale of dairy manufacturer Tnuva to China’s stateowned Bright Foods company.
“If there is no public pressure, the company with the cottage cheese house will be sold to the Chinese,” Braverman said, referring to the well-known image of the small home on Tnuva’s cottage containers.
British private equity firm Apax bought a majority of Tnuva back in 2006, and is in early stage negotiations to sell its stake to Bright Foods.
The Tnuva board also approved steps to initiate an initial public offering on the Tel Aviv Stock Exchange as an alternative to selling.
Because no legal recourse currently exists to prevent the sale, Braverman and several other committee members urged a public outcry to try and block the deal. MK Shelly Yacimovich said she would look into what legal steps could be taken to prevent the transaction.
In April, similar regulatory muscle-flexing and popular dismay prompted Canada’s PotashCorp to drop a bid to scoop up Israel Chemicals.
A source close to the negotiations told The Jerusalem Post
that any deal would include provisions to protect Israel’s food security, under which Bright Foods would only export after Israeli demand was met, and continue to invest NIS 250 million a year in technological development. Negotiations are still at an early stage, the source said, and would continue for at least six months.
But neither committee members nor experts testifying at the hearing Tuesday were satisfied with the prospect of continued foreign ownership of the dairy company.
Former Mossad chief Ephraim Halevy said that food security is a vital national interest. The global population is slated to grow by a billion people by 2050.
“There are not currently sources of food and water for a billion more people,” he said.
If China were to control Israeli agricultural technology, but stop investing in it, that could put Israel in a precarious situation when push comes to shove, he argued.
“China may not take our food, but the technology will be in its hands and if we don’t wake up, we’ll find ourselves in a different situation,” he said.
Labor MK Micky Rosenthal took it a step further.
“Future wars won’t be fought with tanks, but with food and the economy,” he said. “Say there is a global crisis and the Chinese aren’t on our side. Tell me what we’ll eat then? Only an irresponsible government would allow this.”
Why China would even want control of Israel’s dairy industry was puzzling to Amos Yudan, chairman of the Israel-China and Hong Kong Chamber of Commerce.
Despite China’s then-premier Wen Jiabao saying in 2007 that he dreamed every child in China would have a glass of milk a day, he said, “The milk industry in China is not developed, and the Chinese are at very early stages of milk consumption.
It seems very strange that they’re going into this field.”
Popular or government actions to upend the deal, he said, would likely have little impact on overall ties with China, which is coming to see Israel as a source of technological innovation.
Many committee members went out of their way to say that it is not China, in particular, that worries them, and condemned the 2006 Tnuva sale to Apax.
But China may play a different role, argued Yoram Evron, a China expert at the Institute for National Security Studies and the University of Haifa.
“There’s a big difference between the British and Chinese companies in question, because Bright Foods is a player in the global food market, so it’s possible that there will be a conflict of interest between them and Tnuva,” he said. “Assuming Tnuva is an essential resource, Israel must test the worst-case scenarios.”