The European Union has unveiled a proposal to suspend preferential trade benefits for Israel and widen sanctions in response to the escalating humanitarian crisis in Gaza.
Under the plan, presented by the European Commission on Wednesday, the bloc would suspend tariff reductions on about 37% of Israeli exports valued at €5.8 billion ($6.9 billion), resulting in roughly €227 million in additional annual duties. Key categories affected would include fruit, rubber products, and certain manufactured goods.
The move marks the most significant EU trade action against Israel since the 1990s, when the two sides signed an association agreement granting preferential access to EU markets. If adopted, Israeli exports would instead be subject to standard World Trade Organization “Most Favoured Nation” rates.
Commission officials stressed that the measure is not a trade ban. Financial flows, customs procedures, and most goods, including Israel’s high-value machinery and chemical exports, would remain unaffected.
The proposal also includes sanctions on two Israeli ministers and an expansion of restrictions targeting members of Hamas. Approval requires a qualified majority among the EU’s 27 member states, a hurdle that could expose divisions within the bloc.
Commission President Ursula von der Leyen said the measures reflect mounting pressure for Europe to take a harder line on Israel. “The horrific events taking place in Gaza on a daily basis must stop,” she said. “There needs to be an immediate ceasefire, unrestrained access for humanitarian aid, and the release of all hostages held by Hamas.”
Israel quickly pushed back. “Steps against Israel will be answered accordingly, and we hope we will not be required to take them,” Foreign Affairs Minister Gideon Sa’ar said in response.
The EU imported €15.9 billion worth of goods from Israel in 2024, led by machinery, transport equipment, and chemicals. Any partial suspension of trade benefits could have ripple effects across industries, even as Brussels insists the measures are narrowly targeted.
The proposal now heads to EU member states for deliberation, with a decision expected in the coming weeks.
