Redefining European engagement in the Israeli-Palestinian conflict

From financial aid to institution building

Policy Brief


The European Union, once a peripheral observer of the Israeli–Palestinian conflict, has ascended to a role of considerable influence. The EU’s engagement, once confined to delivering humanitarian and economic aid, has matured, particularly after the Oslo Accords, into a more proactive diplomatic force. Yet, despite these strides, it has regressed to being perceived as merely a financier, a ‘payer’ rather than a ‘player’.

Today, the EU stands as the Palestinian Authority’s premier financial ally, injecting upwards of €250 million per year, and it also represents over half of the funding for the United Nations Relief and Works Agency despite the recent suspension of pay. Additionally, it is Israel’s predominant trade partner, encompassing 28.8% of Israel’s trade in goods in 2022.

With substantial economic clout and a reputation as a defender of human rights, the EU possesses both the resources and the moral imperative to actively champion peace and prosperity for both Palestinian and Israeli societies. However, the terror attacks on 7 October 2023 and the consequent Israeli military response have prompted a moment of introspection for the EU, challenging it to reconcile humanitarian imperatives with the denunciation of violence, all while navigating the complex political landscape to rekindle the stalled peace process.

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