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22 May 2025


UK halts trade talks with Israel over Gaza offensive, imposes new sanctions

Business Eye Report

Published: 12:48, 21 May 2025

UK halts trade talks with Israel over Gaza offensive, imposes new sanctions

The United Kingdom has suspended free trade agreement negotiations with Israel, summoned the Israeli ambassador, and announced new sanctions against West Bank settlers in response to Israel’s escalating military campaign in Gaza, reports Reuters.

Foreign Secretary David Lammy delivered a sharply worded condemnation in Parliament, calling the Gaza offensive “a dark new phase in this conflict.” He criticized Israeli Finance Minister Bezalel Smotrich’s recent remarks suggesting the destruction and depopulation of Gaza, labeling them “monstrous” and “repellent.”

“This is extremism. It is dangerous, repellent, and I condemn it in the strongest possible terms,” said a visibly angered Lammy. “The military operation is incompatible with the principles that underpin our bilateral relationship.”

Lammy announced that the UK is suspending its ongoing trade negotiations with the current Israeli government. The trade talks had formally begun in 2022 under the previous Conservative administration but had stalled in recent months.

The move comes amid growing international alarm over civilian casualties in Gaza. Gaza medical sources report more than 500 deaths in Israeli strikes over the past eight days. Israel has also enforced a blockade on food, medical, and fuel supplies since March, sparking warnings from humanitarian agencies about a looming famine. A small number of aid trucks were permitted entry on Monday.

Despite reaffirming the UK’s support for Israel’s right to self-defence, Lammy argued that the renewed offensive will not secure the release of hostages and called on Israel to pursue diplomatic solutions similar to January’s ceasefire.

Prime Minister Keir Starmer earlier expressed his horror at the escalating violence in a joint statement with France and Canada. Lammy warned that the UK could take further action if Israel continues its current military campaign.

Israel responded by dismissing the UK’s suspension of talks, with its foreign ministry stating: “The British Mandate ended exactly 77 years ago. External pressure will not divert Israel from defending itself against those who seek its destruction.”

Prime Minister Benjamin Netanyahu has framed the conflict as a "war of civilization over barbarism" and pledged to continue military operations until “total victory.” Israel’s campaign has devastated Gaza, displacing nearly its entire population and causing over 53,000 deaths, according to local health authorities.

In addition to halting trade negotiations, the UK imposed new sanctions on several individuals and groups in the West Bank accused of violence against Palestinians. These build upon earlier sanctions placed on extremist settlers and organizations in 2024.

The UK also previously suspended 30 out of 350 arms export licenses to Israel, citing the risk of contributing to serious violations of international humanitarian law.

Most of the international community considers Israeli settlements on occupied West Bank land—seized in the 1967 Middle East war—to be illegal under international law. Their expansion remains one of the most contentious issues in the Israeli-Palestinian conflict.

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