EU to suspend Israel trade concessions, halt 2025–2027 allocations
The European Commission proposed on Wednesday suspending certain trade-related provisions of the Association Agreement between the European Union (EU) and Israel, alongside sanctions targeting Hamas, extremist ministers of the Israeli government, and violent settlers.
The Commission also announced it is putting on hold its bilateral support to Israel, with exceptions for civil society and Yad Vashem. This suspension will affect future yearly allocations between 2025 and 2027, as well as ongoing institutional cooperation projects and funding under the Regional EU-Israel cooperation facility.
According to the EU statement, the proposal follows a review of Israel’s compliance with Article 2 of the Agreement, which found breaches of essential elements relating to respect for human rights and democratic principles.
The review concluded that Israel’s military intervention in Gaza, blockade of humanitarian aid, intensifying operations, and settlement plans in the E1 area of the West Bank undermined the two-state solution and violated the terms of the Agreement. The Commission noted that this allows the EU to suspend the deal unilaterally.
European Commission President Ursula von der Leyen stated:
The horrific events taking place in Gaza on a daily basis must stop. There needs to be an immediate ceasefire, unrestrained access for all humanitarian aid, and the release of all hostages held by Hamas. The European Union remains the biggest donor of humanitarian aid and an unwavering champion of the two-state solution. Reflecting these principled commitments, and taking into account serious recent developments in the West Bank, we propose to suspend trade concessions with Israel, sanction extremist ministers and violent settlers, and put bilateral support to Israel on hold, without affecting our work with Israeli civil society or Yad Vashem.
Suspension of trade-related provisions
The suspension concerns core trade provisions of the Agreement, meaning imports from Israel would lose preferential access to the EU market and be charged duties equal to those applied to any other third country without a free trade agreement. The Council must adopt the decision by qualified majority, after which the EU-Israel Association Council will be notified, with the suspension taking effect 30 days later.
Sanctions
On sanctions, the package consists of four draft legal acts with nine listings against Israeli ministers and settlers under the EU Global Human Rights Sanctions Regime, alongside a reinforced package of listings against 10 Hamas politburo members under a new criterion of the Hamas Sanctions Regime. These measures require unanimous approval by the Council.
EU-Israel trade
The EU is Israel’s largest trading partner, accounting for 32 per cent of Israel’s total trade in goods in 2024. Total EU-Israel trade in goods reached €42.6 billion, with €15.9 billion in EU imports and €26.7 billion in exports. Trade in services amounted to €25.6 billion in 2023.
Bilateral financial support to Israel, averaging €6 million annually between 2025 and 2027, will also be suspended, alongside institutional cooperation projects worth about €14 million.
Attribution: Amwal Al Ghad English
Subediting: Y.Yasser