EU faces growing pressure to reassess trade ties with Israel over Gaza War

Amid growing unease over the war in Gaza, pressure is mounting on the European Commission to scale back its relationship with Israel – particularly in the area of trade. According to four European diplomats who spoke to Politico on condition of anonymity, several European Union member states are urging Brussels to present concrete options in response to what they view as Israel’s “unacceptable” actions in the Hamas-controlled territory.

“The mood is shifting on the EU’s response to Gaza,” said one EU diplomat, while another emphasized that changing positions among member states are creating momentum for potential action.

The European Union announced a formal review of its trade agreement with Israel, known as the 'EU Association Agreement,' over the “catastrophic” situation in Gaza. 

“The aid that Israel has allowed in is, of course, welcomed, but it's a drop in the ocean. Aid must flow immediately, without obstruction and at scale, because this is what is needed,” the EU's top diplomat, Kaja Kallas, told reporters on Tuesday. 

The European External Action Service (EEAS) is in the process of conducting the review.

Seventeen EU member states, led by the Netherlands, pushed for the review. Its aim is to assess whether Israel is upholding Article 2 of the Association Agreement, which identifies respect for human rights and democratic principles as “essential” to EU-Israel cooperation, and whether Israel is fulfilling its obligations under international law.

The EU member states that voted for the review are: Austria, Belgium, Denmark, Estonia, Finland, France, Ireland, Luxembourg, Malta, the Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain and Sweden. Nine EU members, including the Czech Republic, Hungary, Italy and Lithuania, voted against the review, while Latvia abstained.

European Council President António Costa indicated this week that the review is likely to result in a negative outcome for Israel.

“The situation in Gaza is, of course, completely unacceptable,” Costa said, explaining that a review was in progress. “But watching your televisions and reading your newspapers, I think it’s not difficult to anticipate what is the conclusion that they obtain,” he added.

The outcome of the review will be presented at a meeting of foreign affairs ministers on June 23.

Ditching the Association Agreement altogether will require a unanimous decision by all 27 member states – an unlikely outcome given the 10 states that did not vote in favor of the review.

According to Politico, EU officials are reportedly looking for ways to “scale back parts of the pact” (Association Agreement), a move that would need only a qualified majority vote.

Commenting on the Council’s decision-making process, Costa said, “We need to take decisions by a majority, by qualified majority, or by unity.”

“We should wait for the assessment and then discuss what kind of decision we want to take and what kind of majority we need to take the decision.”