China gains foothold in Gaza Strip

The issue of the ‘day after’ in the Gaza Strip is being tackled by many countries, led by the US. Particularly conspicuous is the involvement of Qatar and Turkey, which strike to play a major role in managing the Strip and have economic and political interests. UN documents obtained by “Globes’ reveal significant economic involvement by another country – China.

While China remains silent on Gaza, Beijing has found the “back door” through which it can benefit from the significant revenue from the reconstruction of the Gaza Strip, estimated at around $70 billion.

It all began with a tender held last April by the United Nations Office for Project Services (UNOPS) for mobile homes, in which a Chinese company won with a bid that was 50%-60% lower than that of the second-placed bid. Interestingly the winner of the tender, which requires the supply of mobile homes with a living room, bedroom, and bathroom with shower, was Heike from Qingdao, on China’s eastern coast, and which is also involved in the field of refrigeration products. This tender was held at a time when a ceasefire and the reconstruction of the Gaza Strip seemed like a distant dream; but now, with the end of the war, the process is gaining momentum.

China stars in the tender

The United Nations Development Agency (UNDP) recently held another tender for 45,000 mobile homes. The countries from which companies bid are quite diverse and include Italy, the UK, Somalia, Jordan and Saudi Arabia.

The gaps between the tender participants’ bids are enormous. Palestinian company Retaj submitted the lowest bid for $152 million, Israel’s Mzmuriya bid $235 million, Turkey’s Dorce bid $257 million, the UAE’s DP World bid $406 million and US company FTR bid $507 million.

The results of the tender were told to the participants this week, and they show that of the 12 lowest bids, nine companies were Palestinians (seven of which are the cheapest), two Egyptian companies and one Chinese company – Shandong Weichang. However, a source well-informed about the composition of the foreign participants in the tender tells Globes that “each of these companies, whether Palestinian or Egyptian, uses Chinese goods.”

China’s involvement in the tender comes alongside its hostile stance towards Israel during the war, and not just at the level of diplomatic statements. For example, as revealed in Globes, Chinese shipping giant Cosco was the only major company that complied with the Houthi rebels’ demand not to visit Israeli ports, and while the Trump administration was fighting Iran, China continued to buy more than 90% of Iran’s oil exports.

Creative way of doing things

So how do Chinese companies, whether they are directly involved in the tender or acting as suppliers of products to participants, manage to make a profit even when they bid significantly lower than others?

The answer lies in the Chinese regime’s excessive government subsidies. The Chinese government is subsidizing 100% of all companies’ logistics costs for exports until 2027. At the same time, Beijing is subsidizing 40% of the cost of exported goods. In other words, if a Chinese company participates in an international tender in general and a UN tender in the Gaza Strip in particular, it can benefit from 40% at the state’s expense.

The regime led by Xi Jinping also ensures horizontal relief with all destination countries, under which the government pays an incentive of about 15% of the total tariffs imposed on Chinese goods at the destination.

The Chinese labor chain is characterized by a creative approach. It is supported by the government, which completely covers the costs of transporting imported raw materials to the People’s Republic, the costs of machines for processing the raw materials, and additional grants given to the workforce in the field.

The Chinese labor model for the Gaza Strip includes shipping the products’ components to Egypt, where their final assembly takes place.

“The King of the Rafah border crossing”

At this point, it is not just about cargo, but also about other goods that are transported to the Strip through El-Arish, including a wide range of raw materials and essential products. To this end, the Chinese are using influential local elements. For example, in one of the tenders of the UN Development Agency, the winner was the construction company Abnaa Sinai, owned by Ibrahim Al Organi, one of the senior Bedouin residents of Sinai and a close friend of Mahmoud el-Sisi, an Egyptian intelligence officer and the president’s son.

Al Organi was in an Egyptian prison but was released about 15 years ago and is now one of the most powerful entrepreneurs in Egypt. According to the “Financial Times”, those who wanted to bring goods into the Gaza Strip for years were required to work with Al Organi’s companies. Al Organi also profited from the escape of Gazans from the Strip during the war, and according to various reports, he charged $2,500-5,000 for each person who wanted to move to Sinai.

El-Sisi Jr., according to Middle East Monitor, was a very significant factor in the establishment of the Organi corporation, which maintains a very close relationship with Egypt’s National Project Services Organization and the Engineering Administration of the army.

This is reflected, for example, in the fact that the task of upgrading the Rafah border crossing facilities has been entrusted to Abnaa Sinai at a time when Egypt was the patron there. “The King of Rafah Crossing” was Al-Organi’s nickname, as reported by French newspaper “Le Monde”.

In short, the initial stages of the reconstruction of the Gaza Strip illustrate how Israel is losing revenue from the reconstruction of the Strip and its supervision, while China is gaining from it in many ways. They also testify to the close cooperation between the el-Sisi regime and China, which is reflected both in joint military exercises and in China being the source of 30%-40% of foreign investment in Egypt.

Published by Globes, Israel business news – en.globes.co.il – on October 23, 2025.

© Copyright of Globes Publisher Itonut (1983) Ltd., 2025.