Smotrich says Israel will respond politically and economically to potential UK sanctions

Israeli Finance Minister Bezalel Smotrich said Israel is preparing political and economic countermeasures in response to potential sanctions or restrictions imposed by Britain and other countries over Israeli settlement activity in the occupied West Bank.

According to Israeli media reports, Smotrich said the government was developing measures across several sectors to respond to actions that could affect Israeli companies or the broader economy.

He said the government would provide a “safety net” for Israeli businesses harmed by potential sanctions while seeking to expand commercial ties with alternative markets.

“One market may close, but others will open,” Smotrich said.

His comments come as the British government prepares a package of measures in response to Israeli settlement policies in the West Bank, particularly plans for construction in the E1 area, east of Jerusalem.

Britain has warned that development of E1 could undermine the territorial continuity of a future Palestinian state and further weaken prospects for a two-state solution.

The E1 plan involves the construction of approximately 3,400 housing units in an area between East Jerusalem and the Israeli settlement of Ma’ale Adumim, alongside associated roads and infrastructure.

The area is considered particularly sensitive because of its location between the northern and southern parts of the West Bank and its proximity to East Jerusalem. Palestinians and critics of the project argue that extensive Israeli construction there would further fragment Palestinian territory.

The United Nations considers Israeli settlements in the occupied Palestinian territories illegal under international law and has repeatedly called for settlement activity to cease. Israel disputes that legal position.