10/30/2012 05:25 pm ET Updated Oct 31, 2012

European Union Trades More With Israeli Settlements Than With Palestinians, Says Report

Fruits, vegetables, wine, beauty products and at-home carbonation devices: These are among the many products Israeli settlements in the West Bank and East Jerusalem export all over the world. According to a new report, the European Union imports 15 times more from these Israeli settlements than from Palestinians, effectively undermining its own aid efforts.

The report, drafted by a coalition of 22 NGOs, including Christian Aid and the International Federation for Human Rights, writes that while the EU has been one of the Palestinians' largest benefactors, EU nations imported $300 million of goods from settlements last year, approximately 15 times the volume of imports from Palestinians.

“The EU spends hundreds of millions of euros in aid each year to support Palestinian state building but then undermines this assistance by trading with settlements, thus contributing to their viability and expansion,” Dr. Phyllis Starkey, former British MP and Trustee of Medical Aid for Palestinians, told the coalition.

Israel denied the report's findings, and a foreign ministry official said the document's figures were "cherry picked" to serve a political agenda, Reuters writes. "There are no official statistics on exports from the settlements," Yigal Palmor said. "They are only approximations."

One popular product made in an Israeli settlement is the SodaStream, an at-home carbonation device sold in more than 30 countries. SodaStream sees nearly 70 percent of its sales in Europe.

The devices are manufactured in the settlement of Ma’ale Adumim, one of the largest in East Jerusalem. Because of its location, the business benefits from tax deductions and subsidies for infrastructure and business development from the State of Israel. The company has access to roads prohibited to Palestinians, while being conveniently located near the capital. In addition, because the company also maintains a factory in Israel, it can sell its products under the label "Made in Israel."

The report explains:

Settlers enjoy easy access to international markets, and have established modern agribusinesses and
industrial zones. In contrast, the Palestinian economy is “severely constrained by a multi-layered system
of restrictions” imposed by Israel, including roadblocks, checkpoints and limited access to land, water, and
fertilisers. As a result, Palestinian exports have fallen from over half of GDP in the 1980s to less than 15 percent
of GDP in recent years, effectively invalidating the EU’s preferential trade agreement with the Palestinians.

Europe is the largest donor to Palestinians, giving around €5 billion between 1994 and 2011. It considers the Israeli settlements illegal under international law and has blamed Israel for deliberately hindering the Palestinian economy in the West Bank, Reuters writes. "Israeli restrictions remain a major impediment to sustainable economic growth," a spokesman for EU foreign affairs chief Catherine Ashton told the news agency on Monday by email.

Reuters adds that the U.N. special rapporteur Richard Falk called for a boycott of companies linked to Israeli settlements in October, a move that the U.S. representative at the United Nations labeled "irresponsible."

More than 500,000 Israelis currently live in settlements in East Jerusalem and the West Bank, and the settlements occupy more than 42 percent of land in the West Bank. According to The Rights Forum, settlement expansion has accelerated over the past two years and more than 16,000 new housing units have been announced or approved.

"With more than 4 million Palestinian and over 500,000 Israeli settlers living in the Occupied Territory, this means the EU imports over 100 times more per settler than per Palestinian," the coalition writes.

The international community, including the EU, has condemned Israel's policy of settlement construction in East Jerusalem and the West Bank, areas Palestinians claim but that were captured by Israel in the 1967 war. Palestinians say that a halt of settlement construction is a requirement to relaunch the peace process.



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