Netanyahu Says Israel Boycott Moves Immoral, Damaging

Israeli Prime Minister Benjamin Netanyahu attacked the growing global campaign to sanction his country for West Bank settlements, saying such efforts weaken Palestinian willingness to make compromises for a peace deal.

His comments drew a retort from U.S. Secretary of State John Kerry, who warned Israel yesterday about the growing sanctions.

“Attempts to impose a boycott on the state of Israel are immoral and unjust,” Netanyahu told his cabinet at its weekly meeting today in Jerusalem, according to a text message from his office. The boycott won’t be successful because it will encourage the Palestinians “to adhere to their intransigent positions and thus push peace further away.”

Netanyahu’s comments reflect growing concern in Israel over recent international steps to boycott or sanction businesses operating in the West Bank and east Jerusalem, including local banks and companies such as SodaStream International Ltd., a maker of carbonated drink machines.

Kerry addressed these sanctions at the Munich Security Conference, cautioning Israel about an “increasing delegitimization campaign” that includes “talks of boycotts.” He said the relative calm and prosperity that Israel now enjoys is “illusionary” and urged it to move forward to a peace deal with the Palestinians.

Accurate Portrayal

After Netanyahu spoke today, State Department spokeswoman Jen Psaki issued a statement saying he has steadfastly defended Israel against boycott efforts and “expects all parties to accurately portray his record and statements.”

It is the second time in less than a month that Israeli ministers have disagreed publicly with Kerry, who is preparing to present Israel and the Palestinians with an outline for an accord to help steer negotiations. Late last month, Israeli Defense Minister Moshe Ya’alon was forced to apologize to Kerry after being quoted as deriding his peacemaking mission as “messianic.”

“We expect our friends abroad to stand by our side against the boycott efforts,” Israeli Economy Minister Naftali Bennett, who opposes a Palestinian state, said of Kerry’s comments in a Facebook post. “The country hasn’t been born yet that will surrender its land because of economic threats,” Bennett wrote.

Detects ‘Concern’

Israeli Justice Minister Tzipi Livni, who is leading her country’s negotiations with the Palestinians, defended Kerry. . “You have to make a distinction between threats and concern,” Livni said today on Army Radio.

The campaign to boycott, divest and sanction Israel over its West Bank policies has gained a higher global profile in recent weeks over developments in the U.S. and Europe. Actress Scarlett Johansson publicly split with Oxfam last week after the U.K.-based charity criticized her role as as a celebrity spokeswoman for SodaStream, which has a factory next to the West Bank settlement Maaleh Adumim outside Jerusalem.

The sanctions reflect international frustration with Israeli settlement construction, said Palestinian Deputy Prime Minister Mohammed Mustafa in an interview last month.

“The divestment is a political message rather than an economic or political one,” he said. “Israel has to recognize that settlement activity is against international law and is preventing the establishment of peace between the Palestinians and Israel, and Israel and the rest of the region.”

Lenders Blacklisted

Dutch asset manager PGGM, which oversees more than 150 billion euros ($202 billion), announced last month it would stop investing in Israeli banks because of their financial operations in the settlements. Norway’s sovereign oil fund last week renewed an investment ban on two Israeli construction companies that build in the West Bank, Africa Israel Investments Ltd. and Danya Cebus Ltd.

Israeli Finance Minister Yair Lapid said last week that if peace talks fail, sanctions may widen, especially in Europe, crippling the economy. The European Union accounts for a third of Israeli exports, Lapid said, and a reduction of its preferential trade ties with Israel would hit “all Israeli citizens in their pockets.”