Senior Israeli ministers and Chinese businessmen laid on Tuesday the cornerstone of a new multi- million dollar seaport in the city of Ashdod in southern Israel.

The new port, which cost 3.3 billion shekels (870 million U.S. dollars), will be Israel's first privatized port and will eventually enable larger cargo ships to dock here.

The government expects it will transform Israel into an international hub for maritime trade in the Mediterranean.

"This is a historic moment," Israeli Prime Minister Benjamin Netanyahu said at the start of the ceremony.

"Laying the cornerstone of the port represents a milestone in Israel's economical development. The new port will enable us to connect with international trade routes by forming a connection between Asia and Europe," he added.

More than 90 percent of all Israel's international trade goes through its seaports. But with the growth in vessels' sizes, some container ships cannot dock in the existing ports.

"Once this port is fully developed, we'll be able to handle the largest vessels that there are, allowing all the routes to visit Israel," the Chief Operation Officer at Israel Ports Company Dov Frohlinger told Xinhua.

With operations due to begin in 2021, the new port will feature 1,050 meters of quays, a terminal area of 800 dunams (around 200 acres), with a maximum capacity of 1.5 million containers per year.

"This will open export markets for us," Frohlinger said. "Large vessels from our main trading partners could come here and (it) will allow our exports to arrive just in time, without having to go through intermediately transshipment ports," he added.

But as Netanyahu, Minister of Finance Yair Lapid and Minister of Transportation Israel Katz were laying the cornerstone of the new port, workers at the Haifa port, further north the coast, went on strike, saying the new port will hurt their jobs.

In an effort to break the monopoly of two state-controlled seaports in Ashdod and Haifa, which together control almost all of the country's imports and exports, the government decided recently to build two new private ports right next to old ports.

Workers of both ports demand that the government negotiate with them on any new move in the ports.

The government claims that the new ports will create more competitive and efficient port service.

"Increasing efficiency will cause Israel's high cost of living to do down, new working places will be created and market barriers will disappear," Lapid said.

Beijing-based China Harbor Engineering Company was contracted by the Israeli government to build the new port in Ashdod. The company that will build the Haifa port has yet to be selected.

"This project is one of the biggest investment projects in Israel," Bai Yinzhan, Vice President of China Harbor Engineering, told Xinhua, "It's also one of the biggest harbor construction projects that Chinese company contracted for."

"I believe the completion of this project will effectively promote economic and trade relations between Israel and other countries," he added. "I believe that this project will write a new page of economic cooperation between China and Israel."

Frohlinger of the Israel Ports Company said he has been working with China Harbor for three years now and is "very confident" that the Chinese newcomer "will deliver a quality product that will serve the Israeli economy for many decades to come."

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