Why UK Is Set To Sanction Israeli West Bank Settlements

Ed Miliband is set to unveil a set of trade sanctions targeting illegal Israeli settlements in the Palestinian territory of the West Bank.

It’s a dramatic move which could seriously damage UK relations with both Israel and its ally the US but will appease pro-Palestinian campaigners across Britain.

The UK already condemned Israel’s plan to build 1,200 new homes on the sensitive E1 area, east of Jerusalem, in August.

Burnham and his counterparts in France, Germany, Italy, the Netherlands, Norway and Canada accused Israel of trying to “undermine the prospect of a two-state solution”.

Israel openly admitted its attempt to build more settlements is meant to “erase” the idea of a Palestinian state.

Keir Starmer’s government also formally recognised the independent state of Palestine last year, along with the majority of UN member states.

But the foreign secretary’s move today goes much further as he looks to “reset” the UK-Israel relationship. Here’s what you need to know.

The foreign secretary will tell MPs in a statement today that he will sanction goods and services from Israeli settlements – which are illegal under international law – in the occupied West Bank.

It comes after Israel unveiled plans to extend developments in the area.

Tensions in the West Bank have spiked in recent months as violent disputes have erupted between Israeli settlers and Palestinians.

Israel has built about 160 settlements housing 700,00 Jews since it first occupied the West Bank and East Jerusalem during the 1967 war.

Approximately 3.3 million Palestinians are estimated to live among them.

Expansion in the West Bank has increased since Israeli prime minister Benjamin Netanyahu’s return to power in 2022 and since the start of the Gaza war in 2023.

The Netherlands has recently banned trade from settlements, too.

Israel hit back by expelling two Dutch diplomats from a US-led centre in the south of country who were working on the Gaza ceasefire.

It’s worth noting Miliband did warn Israel of the consequences if it pursued this settlement plan.

He summoned the Israeli ambassador last month, explained the UK’s objections and demanded an “immediate reversal”.

Israeli foreign minister Gideon Saar replied: “[It’s] absurd for Britain to lecture the Jewish people about where they may live in their historic tiny homeland.”

He added: “The UK government’s decision to damage the relationship between our countries is deeply unfortunate.”

There are fears Miliband’s move could undermine vital intelligence cooperation which has previously helped to foil terrorist attacks in the UK – while also alienating key international allies.

The Conservative shadow home secretary Chris Philp noted the move will be “very difficult” to execute in practice, as it will involve distinguishing goods from the West Bank and from Israel.

Others fear it could backfire and actually help Netanyahu ahead of the general election coming up in Israel in October, which he is currently predicted to lose.

Labour MP Peter Prinsley said he warned Miliband that his announcement would increase the threat of attacks on British Jews.

The vice-chair of Labour Friends of Israel told the BBC: “My fear is that opponents of Israel won’t distinguish between Israeli government policy, Zionistic political philosophy and British Jews.

“As far as they’re concerned, the whole thing’s the same. It carries a real risk of increased chances of attacks on the British Jewish community. That is exactly what I said to Ed Miliband when I was asked to see him two or three nights ago.”

He suggested waiting until after the Israeli elections next month to act.

Jonathan Hall, the independent reviewer of terrorism legislation, also warned that the government risked “painting a target” on the backs of British Jews.

There is a strong pro-Palestine movement in the UK – including within Burnham’s own party.

Labour lost multiple seats to pro-Palestine candidates in the 2024 general election, making the party much more aware of how many voters they have lost over perceived inaction over the Gaza war.

The party is facing a significant challenge from the left-wing Greens in the upcoming Holborn and St Pancras by-election, too.

Several members of Burnham’s cabinet have openly criticised Netanyahu’s actions against Gaza, as well.

The Labour MP and chair of the Foreign Affairs Committee Emily Thornberry supported the idea, saying the UK has to “challenge” Israeli plans.

She pointed out to the BBC’s Radio 4 Today programme that the Israeli government has expressly said it wants to “snuff out any chance of a Palestinian state”.

She said the UK must “do everything it can to protect the possibility of a Palestinian state”.

Thornberry pointed to the historic sanctions against Russia over its 2014 annexation of Crimea as proof that such penalties can be effective.

Israel’s foreign secretary Gideon Saar refused to respond to questions about possible retaliation against the UK on Monday.

But Israel’s far-right finance minister Bezalel Smotrich has already called for the British ambassador to be expelled.

The ultranationalist settler leader and National security minister Ben Gvir said Netanyahu should recognise Argentina’s claim to the Falkland Islands – a British overseas territory – and impose sanctions on Britain “as long as the occupation continues”.

Burnham has also not spoken to the Israeli prime minister since getting the keys to No.10 six weeks ago, according to work and pensions secretary Pat McFadden.

However, the minister told Times Radio he is “sure” they will speak soon.

The president is yet to publicly respond to news of the sanctions, but is highly unlikely to welcome this crackdown from Britain, as an ardent ally to Israel.

Burnham spoke to Trump on Monday afternoon over the phone and the Downing Street readout hinted they may have discussed Britain’s upcoming sanction plan.

A spokesperson said: “On the Middle East, the prime minister set out the UK’s commitment to working towards peace and security in the region, stressing the importance of the two-state solution.”

Margaret Thatcher’s foreign secretary, Malcolm Rifkind, told Times Radio: “Trump will make some very hostile remarks about the British government.

“And although some of his criticisms may have some validity, I don’t dismiss them completely.

“But he will be doing it out of a sheer knee-jerk reaction… Tomorrow, 24 hours from now, it could be the other way around.”

Burnham’s first trip to the US in the upcoming weeks could well be awkward as a result of this divide.

Trump’s ambassador to Israel, Mike Huckabee, already accused Miliband – who is Jewish – of “Jew hate” after the foreign secretary made a video on the “horrific” situation in Gaza.

Downing Street rejected that assertion on Monday, saying it was still “committed to protecting Jewish communities in the UK”.

But Huckabee doubled down on Tuesday, accusing the government of “discrimination against Jews”.

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