Israel Renegotiates COVID-19 Testing Lab Deal With China

Amidst the severe economic downturn stemming from the COVID-19 pandemic, countries are desperate to increase the availability of testing kits, a prerequisite for lifting stay at home orders. China, whose failure to contain the virus resulted in the pandemic, is attempting to change the narrative by positioning itself as a leading supplier of testing kits and medical supplies.

The United States, for example, recently received a donation of Chinese medical supplies from the Jack Ma Foundation. But many Chinese testing kits are faulty, as countries such as the Czech Republic, the Netherlands, Spain, and the United Kingdom have recently learned.

Israel, too, has looked to China for planeloads of medical equipment. But there appear to be limits to this relationship. Israel recently made a difficult decision to prioritize the privacy of its citizens’ health data by freezing a deal with BGI Genomics, a Chinese company that partnered with Israel’s MyHeritage to create a COVID-19 testing lab in Israel .

On March 30, Israel announced its plans for a MyHeritage-BGI Genomics testing lab in Israel. BGI committed to sending testing machines and RNA extraction robots along with 25 Chinese experts to train Israeli staff. But on April 12, the deal was temporarily frozen. By April 17, the deal was again set to move forward, but this time with adjusted terms.

While the details are not public, it is clear that Israel recognized the risks of having a Chinese firm operate its testing labs. BGI claims to have sequenced over 150,000 whole human genomes. According to the FBI, BGI coordinates closely with the Chinese government, and the opacity of this arrangement has drawn comparisons to Huawei Technologies, the telecommunications company that was blacklisted by the United States because of concerns over privacy and espionage. BGI got in trouble with the Shenzhen stock exchange for “violations of regulations” after the company published gene data online without the permission of the Chinese nationals who participated in the study. BGI was compelled to purge the data and also asked that an article that analyzed this data be deleted.

According to news reports in Israel, the revised deal with BGI stipulates that BGI will provide Israel with testing equipment but that all of the tests will be performed in Israel by Israeli companies selected by Israel’s Ministry of Health. This appears to address concerns about granting the company access to Israelis’ genetic information.

This episode comes amidst recent discussions between the United States and Israel regarding American concerns over Chinese strategic investment in Israel. Washington has pressed its most important Middle East ally to “de-couple” from Beijing or to otherwise mitigate risks. By freezing and then rectifying this deal with BGI, Israel has demonstrated its willingness and ability to do just that, even in times of crisis. However, the episode is clouded by the fact that BGI recently reached a deal with the state of Maryland to provide 1,000 test kits. It remains unclear whether the United States has taken similar steps to ensure the privacy of its citizens, underscoring the need for closer oversight and coordination in an increasingly complex environment.

Julia Schulman is senior director of special projects at the Foundation for Defense of Democracies (FDD). For more analysis from Julia and FDD, please subscribe HERE. Follow FDD on Twitter @FDD. FDD is a Washington, DC-based, nonpartisan research institute focusing on national security and foreign policy.