UK Considers Sanctions on Israeli Banks Over West Bank Settlements

Senior British officials are reportedly considering unprecedented sanctions against Israeli banks that facilitate the development of settlements in the West Bank. This potential move escalates the diplomatic dispute between London and Jerusalem, following Israel's retaliatory measures. According to sources speaking to Channel 12 News, the sanctions regime could extend beyond products manufactured in the settlements.

If implemented, these sanctions could target Israeli banks providing mortgages for properties or construction beyond the Green Line, and potentially extend to marketing networks. Such actions could have a significant impact on the Israeli economy. Britain has already announced sanctions, including a ban on purchasing goods from settlements, in response to Israel's decision to build in the E1 area.

The expanded sanctions package is currently under discussion and is expected to be finalized within six to nine months. British officials criticized Israeli Foreign Minister Gideon Saar's response, which included ordering British representatives at an international headquarters to leave within a week. Israel, however, deemed its response proportionate, arguing that Britain has become more critical of Israel than even traditionally critical nations like Belgium.

The core of the dispute lies in the construction in the E1 area, which Western countries argue undermines the territorial contiguity of a future Palestinian state and hinders the two-state solution. British Foreign Secretary Ed Miliband had previously announced sanctions targeting companies and individuals involved in settlement expansion, including construction, infrastructure, financing, and real estate, as well as a ban on imports from what he termed 'illegal settlements in the occupied territories' and restrictions on arms exports.