EU diplomats unsure how to handle Netanyahu

It’s not the result the EU wanted.

Netanyahu on Monday answered “correct” when asked by the NRG news agency if he rejects the idea of a Palestinian state. He indicated he will build more settlements and, on Tuesday, stirred racist feeling by referring to “Arab voters” being bussed to ballot stations “in droves” to vote against him.

His victory saw an immediate backlash by Palestine.

Saeb Erekat, its chief two-state negotiator, said EU and US impunity for Netanyahu’s past “settlements, racism, apartheid” helped him to win and pledged to pursue Israel cases in the International Criminal Court in The Hague.

Hamas, the militant group which rules Gaza, urged Erekat’s Palestine Authority (PA) to sever ties with Israel.

The EU statements put a more cheerful face on the situation.

Cameron said only: “As one of Israel’s firmest friends, the UK looks forward to working with the new government”.

Mogherini said: “The EU is committed to working with the incoming Israeli government on a mutually beneficial relationship as well as on the re-launch of the peace process … I’m confident that we can work together”.

Her statement didn't use the phrase “two-state solution”. But her spokeswoman, Maja Kocijancic, told EUobserver: “The EU position hasn’t changed regarding the two-state solution [as the model for peace], and that's well known”.

She added that, despite Netanyahu’s statements, “the new government has yet to define its position”.

Campaign speeches aside, Israel's position will become clear in the next three to six weeks, when Netanyahu negotiates a government programme with his new coalition partners.

One senior EU source told EUobserver member states are keen for him and for the Israeli public to quickly forget the NRG remarks.

“We would hopefully see his comment as desperate last-minute electioneering”, the source said.

He noted that if Netanyahu is serious it would amount to a “fundamental breach” of the “bedrock of our international community approach” to the conflict, and that “from [my country’s] perspective, that should trigger the EU to use the leverage it has on Israel, but the EU remains deeply divided on using that leverage”.

The potential for full leverage, in terms of trade restrictions (the EU and Israel do €30bn/yr of business) and diplomatic isolation (EU and/or UN recognition of Palestinian statehood) is considerable.

The realistic next step would be to publish a non-binding EU code for retail labels on settler imports.

Other EU contacts say neither option is likely, not least because it wouldn’t make a difference unless the US also applies pressure, a development no one expects.

“I think there’ll be more focus on a diplomatic push, not on small issues, like labelling of settler goods, which wouldn’t change the mind of a very confident PM who just received a strong mandate”, a second EU source said.

He noted the EU might endorse a multilateral model, involving Arab countries, instead of the Israel-Palestine model, for future two-state talks.

“This regional approach to re-engage the peace process hasn’t been clearly fleshed out yet, but there’s a need for a regional framework because the purely bilateral framework hasn’t worked … the majority of Israelis don’t see Abbas [the PA president] as a partner, so a regional framework could be one way to address this”.

A third source, from an EU country which holds a UN Security Council veto, said Europe might gamble on the US abstaining on a new resolution.

Referring to a joint British-French-German text, drafted in December but never put to a vote, which speaks of resumption of two-state talks with a two-year deadline for conclusion, the EU source said: “We’ve already sketched out a political horizon, which has been absent for some time, and which offers reassurance to the Palestinians and Israelis that there is some sense in going back to a process [two-state talks] which lacks credibility on both sides”.

Whether Netanyahu will wait until his rhetoric blows over or whether he plans, in earnest, to pursue a one-state or other model, remains to be seen.

But his comments in the small hours of Wednesday morning, as the vote-count sealed his victory, were already different to those of 48 hours before.

“Real security, economy, and social welfare, which we are committed to, this is what's important to … everyone, Jews and non-Jews alike”, he said.

"All of you are important to me”.