Palestinian protesters hold up flags and a sign reading “boycott occupation and its products” during a protest at a Rami Levy supermarket in the West Bank Jewish settlement of Modiin Illit, October 24, 2012 (photo credit: Issam Rimawi/Flash90)

RUSSELS — At least half the member states of the European Union, including  France and the UK, currently support labeling products manufactured in Israeli  settlements, a European official said on Tuesday.

In parallel, European diplomats have been mulling the possibility of ending EU  funding for the Palestinian Authority should negotiations between Israel and the  PLO fail, the Times of Israel has learned. Such a move, if undertaken, could  lead to the financial collapse of the PA, which receives European funding  estimated at between €300 and €500 million per year.

Andreas Reinicke, a German diplomat serving as the EU  special representative for the Middle East peace process, told journalists  at the European External Action Service — the EU organ responsible for foreign  policy — that the current European stance represents growing discomfort in  Brussels with Israeli construction beyond the Green Line even as negotiations  are underway with the Palestinians.

“When I began my position in February, only two states  supported labeling, now 14 or 15 states support it. The trend is clear,”  Reinicke said.

The EU agreed last week to include Israel in its prestigious scientific cooperation project Horizon  2020 following protracted negotiations between Israeli Justice Minister and  chief peace negotiator Tzipi Livni and the EU’s foreign policy chief, Catherine  Ashton, on November 26. The partnership was delayed due to new European  guidelines, scheduled to take effect in January, which bar funding for Israeli  institutions in the West Bank.

The demand to clearly mark products manufactured in  the settlements was originally initiated by the BDS movement in Europe, but the  initiative is rapidly gaining traction in mainstream political discourse — a  trend Israeli diplomats serving in Europe are attempting to curb. Last month,  BDS activists in Ireland placed  stickers reading “For justice in Palestine boycott Israel” on Israeli  products sold at Tesco supermarket chain.

The worrisome blanket boycotting of Israel could be  curtailed if Israel showed serious commitment to peace talks with the  Palestinians, Reinicke said.

Palestinian politicians, meanwhile, are continuing to  demarcate the borders between “legitimate Israel” and Israeli entities beyond  the Green Line that should be shunned.

On Tuesday, PLO Executive Committee member Hanan  Ashrawi called on the Dutch government to exclude settlement companies from the  Netherlands-Israel Cooperation Forum set to be launched next weekend.

“This is incomprehensible and unacceptable,” Ashrawi  said in a press statement. “The official policy of the Dutch government is to  discourage economic relations of Dutch companies with settlements. How can the  Dutch government establish a cooperation forum with Israel which facilitates  these relations and effectively supports the settlement economy?”

Palestinian law bans any form of cooperation with  Israeli settlements.

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