Israel's Ministry of Defense has ordered submarines from Thyssenkrup Marine Systems. There is a lot of controversy about the transaction as there may have been a conflict of interests seeing as PM Binyamin Netanyahu’s private lawyer, David Shimon, also represents ThyssenKrupp’s Israel representative, Miki Ganor.
Possibly adding to this is a game-changing piece of information. The Iranian Foreign Investment Company (IFIC) is owned by the Iranian government and is their main venue for foreign investment. This company now owns about 5% of ThyssenKrupp, a German conglomerate that is building the submarines. Iran’s investment in ThyssenKrupp was higher once but after pressure from President George W. Bush in his war against the “axis of evil” in 2003, the investment was reduced. Bush, at the time, threatened to refrain from any new deals with Thyssenkrupp if the Iranian investment wasn’t reduced. Evidently 4.5%-5% is a tolerable level for the U.S. and perhaps even for Israel.
According to a Yediot Acharonot report last Friday, the Ministry of Defense claimed they knew of no Iranian involvement in the company. Former Defense Minister Moshe Yaalon said he wasn’t aware that the Iranians were partners in the company. He was also unaware that, in 2005, when Israel was negotiating the deal on what type of submarines would be built, there was an IFIC representative on the board of ThyssenKrupp.
The current Minister of Defense, Avigdor Lieberman, on the other hand claims that “the issue of Iran’s share in the submarine’s manufacturer was known long before I took office.” In fact, according to Lieberman, “It was discussed in the cabinet and in the National Security Council and the reality is quite different from how it’s being portrayed in the media. We have no other alternative and Iran’s share is negligible.”
This morning MK Tzipi Livni (Zionist Union) requested an urgent meeting between the Knesset Foreign Affairs Committee and the Defense Committee to discuss this topic. In her application for the meeting she wrote, “For years Israel has worked with the nations of the world to prevent transactions with Iran and prevent it from economic benefit. Even if the IFIC’s investment in ThyssenKrupp is small, the scope of this transaction makes this significant”.
ThyssenKrupp also makes the state of the art “Saar 6” warships which are currently under construction. The possibility of compromise of secrecy on these projects with information leaking to Iran is another issue which should be discussed.