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Tuesday 20 May 2025 4:38 pm  |  Updated:  Wednesday 21 May 2025 3:36 pm

UK halts trade talks with Israel

By: Ali Lyon

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David Lammy has been appointed deputy prime minister and justice secretary. (PA)
David Lammy was appointed deputy prime minister and justice secretary. (PA)

The UK has paused trade deal negotiations with Israel in response to its military offensive in Gaza, the foreign secretary has said.

Speaking in the Commons, David Lammy confirmed that negotiations with the Israeli government over a bilateral trade pact have been put on ice until the country ensures “unhindered provision of aid”.

“We have suspended negotiations with this Israeli government on a new free trade agreement,” Lammy told MPs. “We will be reviewing co-operation with them under the 2030 bilateral roadmap.”

Lamy added that “the Netanyahu government’s actions have made this necessary.”

The decision represents a further ratcheting up of tensions between Israel and the UK, after Prime Minister Keir Starmer’s administration joined France’s Emmanuel Macron and Canada’s Mark Carney in condemning Israel’s latest offensive in Gaza.

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The three leaders wrote that they “strongly oppose” the highly controversial military action in the western strip of Palestine, which had included a decision to prevent aid from entering the country for 11 weeks.

Israel claims to have brought that blockade to a partial end earlier this week, with the commitment to temporarily let a “minimal” amount of food into Gaza following pressure from US politicians.

But the end to the full block has been branded a “drop in the ocean” by humanitarian organisations, and did not prevent the three Western leaders from calling on Israel to “stop its military actions”.

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“We will not stand by while the Netanyahu government pursues these egregious actions,” they wrote.

Netanyahu reacted furiously to the intervention, branding it a “huge prize” for terrorist organisation Hamas.

Trade halted until aid blockades lifted

The decision to pause talks represents a further ratcheting up of tensions between the UK and Israel, which have traditionally been close allies. But addressing MPs, Lammy stressed the government’s issue was with decisions made by the current Israeli administration, rather than the country as a whole.

“I say now to the people of Israel, we want a strong friendship with you based on shared values and with flourishing ties between our people and societies,” he said.

“The conduct of the war in Gaza is damaging our relationship with your government. And… if Israel pursues this military offensive as it has threatened, failing to ensure the unhindered provision of aid, we will take further action in response.”

The government had been eyeing up closer economic ties with several Middle East countries as the next frontier of its trade push, having inked deals with the US, India and Europe in the past month.

Negotiations to upgrade its existing free-trade agreement with Israel began in 2022. Labour had reaffirmed its plans to resume talks on entering office last July, even after Israeli officials condemned a government decision to suspend some arms exports to Israel in September last year.

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