UK Mulls Tough Sanctions on Israel Over Settlements, Awaiting Election Outcome
The United Kingdom is considering significant sanctions against Israel due to its activities in Judea and Samaria, with potential measures targeting banks and insurance companies. While the final form of the sanctions law is still being developed, which could take six to nine months, British officials are awaiting the outcome of Israel's upcoming Knesset elections. The UK aims to observe the new government's policies regarding settlement expansion before finalizing its actions.
British Foreign Secretary Ed Miliband announced the potential measures two weeks ago, indicating they would extend beyond a ban on settlement products. Proposed sanctions could include import bans on settlement goods and measures against companies financing or facilitating settlement construction. The latter could have a broader impact, affecting financial institutions that do business with settlements.
According to the Financial Times, the exact scope of the sanctions remains undecided and will depend on the actions of the Israeli government and companies in the coming months. Experts suggest the UK is leaving room to maneuver, hoping a new Israeli government might halt settlement development. Officials are keen to avoid unintended consequences that could harm broader UK-Israel economic ties, emphasizing that the measures are not aimed at Israel itself, despite acknowledging the benefits Israel derives from its pharmaceutical and defense industries.
Sanctions against Israeli banks and insurance companies are considered the most potent tool, according to Dror Strum, former head of Israel's Competition Authority. He warned that such actions could significantly disrupt financial systems due to the interconnectedness of major banks and payment systems, especially given London's status as a global financial hub. However, some believe it would be difficult for London to target Israeli banks without impacting Israel's wider economy. Even without direct financial sanctions, there's a concern that foreign companies might broadly avoid Israeli products and businesses due to the complexity of modern supply chains and the risk of inadvertently violating sanctions.
