A day after President Barack Obama told Israel its key ally would no longer tolerate building settlements in the West Bank, the European Union was considering using its trade clout to bolster U.S. pressure, diplomats said.
The EU is the Jewish state'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 Israeli settlers on occupied Palestinian land.
Some European governments have long suspected such products are entering the EU at low import tariffs reserved for output labelled as coming from Israel proper.
It was the latest sign of the depth of the dispute between Prime Minister Benjamin Netanyahu's government and its closest allies.
In Washington, Secretary of State Hillary Clinton hit back hard at comments by a senior Israeli negotiator who said Obama's predecessor George W. Bush privately agreed to expansion of settlements. That was not U.S. policy, she insisted.
At the same time, there was no sign of a change of heart by Netanyahu's two-month-old government, a coalition that includes right-wing groups attached to expanding the colonisation of the West Bank.
"The Israelis are listening," one European diplomat said.
"But there is no sign that the Israelis have any intention of stopping. So what next?"
Much attention was paid to his declaration that all further settlement building was not legitimate in American eyes and his call for a Palestinian state .
So U.S. and EU diplomats are discussing "pressure points" that could be used to persuade the prime minister, who risks seeing his coalition break down if he makes concessions. Envoys may meet on Wednesday to coordinate a response, diplomats said.
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 Netanyahu.
In addition to being Israel's largest market for exports, the EU is its second largest source of imports after the United States.
Even Netanyahu's opponents baulked at Obama's call for a full settlement freeze: "This is an illegitimate demand," said leading lawmaker Tzahi Hanegbi of the centrist Kadima party.
Güncelleme Tarihi: 06 Haziran 2009, 15:26