Will the EU's Proposed Trade Curbs on Israel Change the Gaza War Dynamics?

The European Commission has proposed significant trade restrictions with Israel, aiming to impose sanctions on extremist ministers in the Israeli government amid the ongoing conflict in Gaza. If enacted, these measures would represent the EU's most stringent response to the crisis, including the suspension of trade provisions from the EU–Israel Association Agreement.

Last updated: 03 October 2023 (BST)

Key Takeaways

• The European Commission's plan targets trade and sanctions against Israel.
• It seeks to suspend trade advantages under the EU–Israel Association Agreement.
• Implementation requires approval from member states, which is uncertain.
• The proposal has faced strong criticism from Israel, labelling it "distorted".
• The economic impact of the trade restrictions is estimated to be low.

Understanding the Proposed Measures

The European Commission's recent proposals are part of a broader strategy to respond to the humanitarian crisis in Gaza. Commission President Ursula von der Leyen outlined these plans, which include suspending the trade-related provisions of the EU–Israel Association Agreement. This would strip Israeli goods, particularly agricultural products such as dates and citrus fruits, of their privileged access to the European market.

The EU–Israel Association Agreement

Established in 2000, the EU–Israel Association Agreement is a framework facilitating trade and cooperation. By suspending it, the EU aims to exert pressure on Israel regarding its actions in Gaza. This move could impose tariffs on billions of euros' worth of Israeli exports, fundamentally altering the trading relationship.

Economic Impact and Trade Volumes

Despite the potential for significant changes in trade dynamics, the economic impact of the proposed restrictions appears to be minimal. EU Trade Commissioner Maroš Šefčovič has estimated that the effect of ending tariff preferences would amount to only €227 million (£195 million) annually. In contrast, Israel's trade volume with the EU accounted for 32% of its total trade in goods in 2024, amounting to approximately €42.6 billion (£35.8 billion).

Political Challenges Ahead

While the proposals have been unveiled, they face considerable political hurdles before any implementation can occur. Trade restrictions necessitate the approval of a qualified majority among EU member states, while sanctions on individuals require unanimous agreement. Key countries, including Germany and Italy, have expressed resistance to the plans, complicating the approval process.

Member State Responses

Responses from member states have varied, with Ireland and Spain advocating for tougher measures against Israel. This division highlights the complexities within the EU when addressing sensitive geopolitical issues. EU foreign policy chief Kaja Kallas acknowledged these challenges, stating, "Political lines are very much in the place where they have been so far."

Targeting Extremism

The proposed measures also aim to target extremist elements within the Israeli government. Kallas mentioned that the package would include sanctions on "Hamas terrorists" and unspecified "extremist ministers" in Israel, as well as "violent settlers and entities supporting the impunity going on in the West Bank." This broader focus indicates the Commission's intent to address not only the actions of the Israeli state but also the complex dynamics at play in the region.

Immediate Actions and Symbolic Measures

One immediate action is the suspension of bilateral support to the Israeli government, which is largely symbolic, amounting to only €9.4 million out of a total €14 million allocated for 2020–2024. This measure does not require approval from member states, allowing the Commission to implement it more swiftly. However, it raises questions about the effectiveness of such limited financial measures in influencing policy.

Funding for Civil Society

It is important to note that funding for programmes aimed at tackling antisemitism and supporting civil society will remain unaffected by the proposed cuts. This suggests that the EU is attempting to balance its stance towards Israel while continuing to support initiatives that promote dialogue and coexistence.

Reactions from Israel

The Israeli government, represented by Foreign Minister Gideon Saar, has vehemently rejected the Commission's proposals. Saar described the measures as "morally and politically distorted," warning that any actions taken against Israel would have reciprocal consequences. His remarks reflect a broader concern in Israel regarding how these sanctions could affect European interests and the geopolitical landscape in the region.

The Future of EU-Israel Relations

As the conflict in Gaza continues, the future of EU-Israel relations hangs in the balance. The proposed measures, while significant in their intent, may ultimately falter in the face of political resistance from key EU member states. The lack of clarity regarding when the proposals will be voted on only adds to the uncertainty surrounding this issue.

Conclusion: What Happens Next?

The EU's response to the ongoing war in Gaza will likely evolve as political dynamics shift within member states. The proposals represent a clear stance from the European Commission but face significant hurdles before implementation. The situation remains fluid, with ongoing discussions among member states likely to shape the final outcome. As the crisis continues, the question remains: how will the EU navigate this complex geopolitical landscape while balancing its values and interests?

#EUIsraelRelations #GazaConflict #TradeSanctions

FAQs

What are the main proposals from the European Commission regarding Israel?

The European Commission proposes suspending trade provisions of the EU–Israel Association Agreement, imposing tariffs on Israeli goods, and targeting sanctions on extremist ministers within the Israeli government.

What is the economic impact of these proposed measures?

The estimated economic impact of the trade restrictions is around €227 million (£195 million) annually, which is relatively low compared to Israel's total trade volume with the EU.

What challenges do these proposals face within the EU?

The proposals require member state approval, with key countries like Germany and Italy opposing them. This political division makes the adoption of the measures uncertain.

How does the suspension of bilateral support affect Israel?

The suspension of bilateral support, amounting to €9.4 million, is largely symbolic and does not require member state approval, but it indicates the EU's stance on the current situation.

What response has the Israeli government given to the proposed sanctions?

The Israeli government has rejected the proposals as "morally and politically distorted," warning that any actions taken against Israel would result in reciprocal measures.