Month: May 2014

Stop trade with illegal Israeli settlements on stolen Palestinian land

The UK Government says settlements are “illegal, an obstacle to peace and not helpful in creating the solution to the two-state process”. However, British firms are keeping these illegal settlements in business by trading with them and investing in them.

The European Union is the biggest donor of aid to the Palestinians. But it undermines its own policy by importing goods worth £198 million a year from the settlements compared with only £13 million a year from Palestine.

Trade is big business for the illegal settlements. Without access to export markets some would not survive. Israel puts the value of the settlement export trade at $300m (£198m) annually. So, whilst we are funding Palestinian projects to help protect them against the encroachment of settlements we are providing the financial incentive to keep the settlements expanding.

The increased involvement of UK businesses such as G4S and Veolia in settlements is causing reputational damage to themselves and is in apparent conflict with government policy on the illegality of settlements.

For instance, Tesco is profiting from and providing economic support to Israel’s illegal settlement enterprise and contributing to Israel’s deliberate destruction of Palestinian agriculture through its relationship with the Israeli firm Mehadrin, Many illegal settlements in the Jordan Valley region are only economically viable because they are able to export their produce to Tesco and other supermarkets.

The Dutch government has already stated that it discourages financial relationships with illegal Israeli settlements and the German and Dutch governments have intervened when a business registered in their country has been shown to be participating in Israeli violations of international law.

The British security company G4S provides equipment and services to Israeli-run checkpoints and terminals in the West Bank and Gaza, and to security services to private homes and businesses inside illegal Israeli settlements

This not only enriches the settlements, but impoverishes the Palestinians. The settlements achieve their economic success at the expense of Palestinian economic viability. Additionally the West Bank is interlaced with roads which link settlements to Israeli ports and are closed to Palestinians.

They are not just setting up factories in uninhabited deserts. They take all the lushest and most fertile land in the Jordan valley, the rich mineral resources from the Dead Sea and 80% of the water from the aquifer that runs under the West Bank. Why do you think the Palestinians grow so many olive trees?  Because it’s the only plant that can survive with so little water.  Even then, the Israelis have demolished 800,000 olive trees.

The settlements have a negative  impact on the lives of Palestinians living in East Jerusalem and the West Bank, resulting in the need for more aid for Palestinians. This vicious cycle reveals the absurdity of EU and UK policy making on Palestine.

In February 2013 Palestinian trade unions and agricultural organisations, representing farmers and workers across the occupied Palestinian territories, called for action to end European trade with settlement export companies. In a briefing titled “Farming Injustice”, the organisations explained how European trade with illegal Israeli settlement companies helps settlements to flourish and causes the dispossession and displacement of Palestinians and the destruction of Palestinian agriculture. Many illegal Israeli settlements are only able to flourish because the companies operating within them are able to export their produce to UK high street retailers.

Is it legal? Some international lawyers say we have an obligation to stop trading with illegal settlements. Other say we have the power (without breaking EU or GATT rules) rather than an obligation to do so.

Is it ethical. All agree that settlements profit from the expropriation of Palestinian resources.  By trading with settlements, we profit from Palestinian poverty.

Is it practical? Whilst we are funding Palestinian projects to help protect them against the encroachment of settlements, we are providing the financial incentive to keep the settlements expanding.

It is a question of integrity. The UK Government claims to regard it as illegal, but will do nothing about it.  Do we take the same attitude to chemical weapons, to blood diamonds, to state-sponsored terrorism?

On December 3rd 2013 the Government’s Overseas Business Risk Register issued new business guidance to UK firms trading in Israel.  This was done without any press release or announcement.  The new advice says “we do not encourage” UK business to trade with or invest in settlements. This is a very small step in the direction of a ban on settlement trade.  It is a recognition that trade with illegal settlements is not to be encouraged.  But it is a half-hearted start.  It should say at least “discourage” or “advise them not to trade or invest”.

The EU also announced in a directive issued on July 7th 2013 that it would stop giving research grants to companies based in illegal settlements, but settlements will still benefit from trade with the EU. Stopping trade with illegal settlements is the only policy that is consistent with the UK’s declared policy of support for the state of Israel, but opposition to settlements.

Who’s against?

12 Ambassadors

Leaked reports of a confidential 2012 report by EU Ambassadors and Consuls to Israel and the Palestinian territories showed that they recommended to their governments that the EU should “prevent, discourage and raise awareness of” the trade and investment by EU companies that support illegal Israeli settlements.

EU governments are thus going against the advice of their own ambassadors by refusing to impose a ban on trade and investment in illegal settlements.

Charities and NGOs.

Reports by NGOs calling for a ban on settlement trade, such as “Trading Away Peace” supported by 22 churches and charities, explains how Europe helps sustain illegal Israeli settlements[i]



The TUC Congress voted in 2009 to “call on the government to …. seek EU agreement to impose a ban on the importing of goods produced in the illegal settlements.  In 2010 the TUC extended this policy to  “companies who profit from illegal settlements, the Occupation and the construction of the Wall.”

The Co-op

The Co-operative Group announced in 2012 that it would no longer source products from any supplier that operates in illegal settlements and cut ties to four Israeli companies following pressure from its members.

Other countries

During his visit to London in July 2013 Palestinian President Abbas urged Britain to “use its good offices” with European countries to persuade them not to trade with settlements. He said that 30 other countries were considering similar action.

He said he was not asking the British government to boycott Israel.  The Palestinian Authority had commercial relations with Israel. But he wanted the British government to stop supporting settlements.

The Dutch government has stated that it discourages financial relationships with illegal Israeli settlements and the German and Dutch governments have intervened when a business registered in their country has been shown to be participating in Israeli violations of international law.

Many Israelis agree with Ran Gidor, former political counsellor at the Israeli Embassy in London, who said in the Commons that settlements are “the single biggest mistake in Israel’s history” – a disaster for Palestinians but a disaster also for Israel.

Ending trade and investment with the settlements would be an anti-settlement policy, not an anti-Israel policy.  It will not affect the economy of Israel itself.  But it will send a message to Israel’s leaders that we will not condone or cooperate with their ill-judged and illegal settlement project that threatens the future for both Palestine and Israel.”

We believe that the FCO guidance should explicitly advise UK businesses not to support settlement activity. This would include advice to cease trade with companies exporting from Israeli settlements and cease involvement and investment in companies, businesses, and infrastructure services operating in the settlements and supporting the occupation.

The US will never stop the Israelis.  The EU will never agree.  It’s up to countries like Britain and France to put pressure on Israel to reach a settlement. The first step has to be focused on the root cause of the trouble – the settlements.

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