EU seeks to increase pressure on Israel for settlement freeze

The European Union is considering using its trade clout to bolster U.S. pressure for an Israeli freeze on settlement construction in the West Bank, diplomats said on Friday.

The EU is Israel's biggest trading partner and one option it may have is to crack down on fruit, vegetables, olive oil and other farm produce grown by settlers in the Palestinian territories.

Some European governments have long suspected such products are entering the EU at low import tariffs reserved for output labeled as coming from Israel proper.

Aside from the possibility of a concerted push to deny tariff concessions to settlement produce coming into the European Union, diplomats said EU nations also were looking at using economic and scientific research exchanges with Israel as an area where they could apply leverage on Prime Minister Benjamin Netanyahu.

In addition to being Israel's largest market for exports, the EU is its second largest source of imports after the United States.

But diplomats said Europe would follow Washington's lead. Concerted EU action will be difficult because of divisions within the bloc, so piecemeal steps are more likely, they added.

EU members have in recent months said that ties between the EU and Israel depend on the Israeli government's commitment to a two-state solution in the peace process with Palestinians.

Following the three-week-long Operation Cast Lead, diplomatic bodies in a number of European countries called for a freeze on upgrading relations with Israel, citing the pressure of domestic public opinion.