The joint condemnation by Britain, France, Germany, Italy, Canada, the Netherlands and Norway of Israel’s decision to proceed with the E1 settlement project reflects a growing problem for the Netanyahu government. European criticism of Israeli settlements is hardly new, but the composition of this group deserves attention. Germany and Italy have remained among Israel’s more reliable partners in Europe since 7 October and have generally resisted attempts to turn criticism of the war in Gaza into a wider political rupture with Israel.
The decision to proceed with more than 1,200 housing units in E1 places these governments in an increasingly difficult position.
The area between East Jerusalem and Ma’ale Adumim has been disputed for decades because construction there would significantly affect territorial continuity between the northern and southern West Bank. Previous Israeli governments have repeatedly considered development in E1 but have also been sensitive to American and European pressure because of the consequences for a future Palestinian settlement.
The present Israeli government appears considerably less concerned by these objections. There are legitimate Israeli security concerns behind the broader debate over the West Bank which European governments sometimes underestimate. The attacks of 7 October fundamentally changed Israeli perceptions of territorial security. Israel’s withdrawal from Gaza in 2005 was followed eventually by Hamas taking control of the territory, the construction of a large military infrastructure and finally the attacks of 2023.
The experience of southern Lebanon has produced similar conclusions among many Israelis. The withdrawal of Israeli forces was followed by the consolidation of Hezbollah’s military position close to Israel’s northern border.
The West Bank presents an even more complicated security problem. Its elevated terrain overlooks some of Israel’s principal population centres and infrastructure, while the distance between the Green Line and the Mediterranean is extremely narrow in parts of central Israel. Few Israeli governments, whatever their political orientation, are likely to accept a future arrangement that does not provide credible security guarantees.
This does not, however, explain the continuing expansion of civilian settlements. There is an important difference between maintaining the security arrangements Israel believes necessary in the West Bank and creating permanent civilian facts that make a negotiated territorial settlement progressively more difficult.
The E1 project is particularly sensitive because of its location. Large-scale Israeli construction between Jerusalem and Ma’ale Adumim would complicate the possibility of creating a contiguous Palestinian state. This is precisely why the project has attracted such consistent opposition from the United States and Europe.
The Netanyahu government appears increasingly convinced that the political costs of proceeding are manageable. Previous international condemnations of settlement construction have produced limited practical consequences, while Israeli governments have learned that European governments are reluctant to translate diplomatic criticism into measures that might fundamentally damage bilateral relations.
Israel’s position in Europe has deteriorated considerably since the months immediately following 7th October. Initially there was broad recognition of Israel’s right to respond militarily to the Hamas attacks. As the Gaza war continued, disagreements over the conduct and scale of Israeli operations increased and public opinion in several European countries shifted significantly.
Germany and Italy nevertheless continued to maintain strong relations with Jerusalem. Both governments recognised Israeli security concerns and resisted some of the more punitive approaches proposed elsewhere in Europe. However Meloni is moving into an election year and Israel’s war in Gaza is not popular in Italy, she is also under pressure to censure the Israeli government. Settlement expansion makes this position more difficult to sustain because it cannot easily be presented as part of Israel’s response to Hamas.
Military operations in Gaza can be debated in the context of hostages, Hamas infrastructure, rocket attacks and Israeli security. Construction in E1 belongs to a different political argument concerning the long-term status of the West Bank. This distinction is particularly important at a time when the Israeli government includes political forces that openly oppose the creation of a Palestinian state and advocate further settlement and annexation.
Israel may consider the two-state solution unrealistic under present circumstances, and there are strong reasons for that scepticism. The Palestinian Authority is weak, Hamas retains support and there is currently no obvious Palestinian political structure capable of providing Israel with confidence that an independent Palestinian state would remain peaceful and demilitarised.
But the absence of a credible Palestinian partner today does not remove the need for a long-term political strategy.
Permanent Israeli control of the West Bank without a political settlement creates its own problems. Formal annexation would raise difficult questions concerning the political status and rights of the Palestinian population. Maintaining the present situation indefinitely would continue to expose Israel to international criticism and periodic violence.
Keeping open the possibility of a future territorial settlement is therefore also an Israeli interest, even if such an agreement appears remote today. The European statement should be considered within this wider context. The seven governments have not simply criticised the E1 decision but have also warned companies considering participation in the project about possible legal and reputational consequences.
This suggests that European policy may gradually move beyond diplomatic statements towards forms of economic and legal pressure directed specifically at settlement activity.
For Israel this comes at an inconvenient time. The regional environment is changing rapidly. Iran has been weakened but remains a significant security concern. Turkey is expanding its influence in Syria and Libya and developing new regional security relationships. Saudi Arabia, Turkey and Pakistan have established the Mecca defence agreement, while the future political balance in Syria and Lebanon remains uncertain.
Israel therefore has an interest in preserving strong relationships with the major European states, particularly Germany, Italy, Britain and France. These countries cannot replace the United States as Israel’s principal strategic partner, but they remain important economically, diplomatically and militarily. They also influence the direction of European Union policy towards Israel.
The Netanyahu government may believe that European governments will ultimately maintain these relationships regardless of disagreements over settlements. Until now, this assessment has largely been correct. The danger is that continued settlement expansion gradually changes the domestic political calculations of governments that have traditionally supported Israel.
Giorgia Meloni has consistently defended Israel’s right to security and has maintained close relations with the Israeli government despite considerable pressure during the Gaza conflict. Her decision to join the condemnation of E1 should therefore not simply be dismissed as another routine European statement.
The same applies to Germany, where support for Israel has a particular historical and political significance. When governments such as these begin publicly opposing Israeli decisions alongside countries that have traditionally taken a more critical position, it indicates that Jerusalem’s room for manoeuvre in Europe is narrowing.
Israel’s security concerns in the West Bank are real and European governments need to take them seriously. The experience of Gaza makes it unrealistic to expect Israel simply to withdraw from strategically important territory on the assumption that a peaceful political order will follow.
Settlement expansion is a different question.The Israeli government needs to determine whether projects such as E1 contribute sufficiently to national security to justify their diplomatic and political cost. At present they appear more effective at weakening the possibility of a future Palestinian settlement and creating difficulties with Israel’s allies than at addressing the immediate security threats facing the country.
Europe has limited ability to determine Israeli policy in the West Bank. Israel, however, has an interest in ensuring that disagreement over settlements does not gradually destroy relationships that have taken decades to build.
The joint statement from seven governments suggests that this process may already have begun.
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