Canadian engineering consultants WSP leaving Israel

Canadian engineering and professional services consulting giant WSP has announced that it is closing its Israel office. The company claims it is part of an organizational change to close offices in small countries and that it will continue to support the projects to which it has committed, first and foremost the Tel Aviv metropolitan region Metro.

But sources have told “Globes” that Israel is not considered a small country because it is a large and major market. So while this is the official explanation, market sources point to the heavy pressure placed on western companies to halt operations in Israel due to the war in Gaza.

Israel, despite its huge potential, which includes injecting hundreds of billions of shekels into infrastructure projects in the coming decades, is today perceived as a sensitive location, and the industry is already concerned about becoming isolated and a reduction in competition for the huge Metro tenders.

25 years in Israel

WSP is one of the world’s biggest engineering consultants. Traded on the Toronto Stock Exchange the company has 70,000 employees in 50 countries including 150 employees in Israel. WSP was formed from the merger of companies in the UK, Canada and the US, and operates in the fields of real estate, transport, infrastructure, energy and the environment.

The group began operations in Israel 25 years ago, and has managed, planned and supervised a series of projects, including the construction of the Jerusalem-Tel Aviv high-speed rail link, the Jerusalem light rail network and the Tel Aviv light rail Red Line, while two years ago it won the tender to manage the M2 metro line. Over the years, the international company established an office in Israel.

Now WSP has announced that it plans to make an organizational change in Israel, in which the local branch will be closed, and the company will continue to provide services for the Metro project, with the rest of its activities being transferred to a new Israeli company.

Despite the Canadians’ efforts to portray the move as routine, the government fears that WSP is effectively giving up on the Israeli market, precisely when it is entering a decade of tremendous investment.

Estimates are that WSP has decided to leave Israel, and there are also doubts that the Israeli company that will be established will have the ability to provide services at the level of a global company, including meeting the threshold conditions in tenders that require international experience in planning and overseeing projects.

Intense pressure

The industry notes that WSP’s decision was not taken in a vacuum. In recent years, the company has been targeted by pro-Palestinian organizations as “supporting apartheid,” a trend that has grown stronger as the war has continued. 105 organizations have petitioned the UN High Commissioner for Human Rights to add WSP’s name to the list of companies operating in “illegal Israeli settlements,” due to its involvement in the construction of the light rail lines in Jerusalem.

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Nor is WSP alone. Almost all European companies operating in Israel are subject to campaigns and intense presure, which sometimes also involves workers unions and investors.

In Spain, for example, engineering and infrastructure development consultants COMSA withdrew from the Blue Line light rail project in Jerusalem, following political pressure. In contrast, the Spanish companies SEMI, which is responsible for electrifying Israel Railways, and CAF, which is building the light rail lines in Jerusalem and Tel Aviv with Shapir Engineering, have remained in Israel, but it has not been easy for them to do so. In Belgium, CAF’s winning of a huge tender to supply carriages worth more than €3 billion has been made clearly conditional on it meeting “the requirements of international law and human rights” in relation to its activities in Israel.

A review by planner Omar Raz points to a broad pattern. A UN report on “those who benefit from Israel’s illegal actions under international law” cited CAF. French company Alstom could, according to foreign media reports, lose a tender for the Barcelona Metro due to its activities here. Germany’s Siemens, France’s Aegis and companies from Italy and Austria have also come under fire for operating in Israel.

What are the alternatives?

Israel, for its part, is expected to double its investment in infrastructure projects in the coming decade, with the completion of planning and budgeting for transport, energy and water projects. Thus, starting next year, the tenders for the construction of the Metro will begin to be published, traversing beneath 24 local authorities and with a cost currently estimated at about NIS 200 billion.

However, while the country is becoming an attractive location, cooling European sentiment could reduce the number of foreign players, leading to less competition. Due to this concern, government ministries had considered forgoing the preliminary qualification stage in the Metro tenders, but in the end it was decided to maintain it, since the true size of the pool of bidders is unknown to anyone.

Added to this is the Chinese question. In April, Israel canceled a deal to purchase carriages manufactured by SIPG following US pressure, closing the loophole on its ambiguous policy on the subject. Finally, an agreement was signed with the company to manufacture the cars in Australia rather than in China, but the question remains. It is unclear whether the Chinese companies will still try to compete here and if they win, whether they will be able to fulfill the contracts.

Meanwhile, the Israeli government has been courting companies from India and South Korea for a long time. An official delegation from NTA and the Ministries of Finance and Transport even visited these countries last year to meet potential companies and investors, but the positive mutual impression has still not been felt on the ground.

Israeli companies, despite having gained considerable experience in planning and building mass transit systems, will not be able to shoulder the burden alone. The concern now is not only about working hands, managers and engineers who will lead the projects, but for the overall interest of the economy, as many companies, from as many countries as possible will compete in Israel. Without broad international competition, the quality of execution will be damaged, while costing much more.

Published by Globes, Israel business news – en.globes.co.il – on September 1, 2025.

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