Israel Looks Beyond the Blue EU Horizon

For many years it has been obvious that the European Union (EU) does not wear Israel in its heart's core or enfold it in its arms. If its members have not totally subscribed to the Palestinian Narrative of Victimhood, they have been sufficiently swayed to impose a partial boycott against Israel. The EU in June 2013 published "guidelines" for its member nations saying that it would not confer grants, scholarships, prizes, or financial loans on Israeli entities operating outside the so-called Green Line (the 1949 armistice lines), including east Jerusalem and the Golan Heights. Any Israeli entity seeking funding from the EU must submit a declaration that it has no direct or indirect links to the West Bank.

This issue was central to the months of negotiations between the EU and Israel on the latter's participation in the EU's Horizon 2020 project. This project, the EU's largest research and innovation program to last six years with a funding of 80 billion euros, was launched on January 1, 2014. After prolonged and tense negotiations a compromise formula was reached making it possible for Israel to participate fully in the project, the only non-European country to do so as a full partner. Israel is expected to contribute between 600 million and one billion euros to Horizon 2020, and in return its universities, researchers, and companies can compete for grants and other funding from the EU.

This is not the first instance of collaboration between the two sides in research and development. In 2012 the Israeli Migal-Galilee Technology Center received a $4.4 million grant from the EU for research on environment, health, and aging. The new agreement enables Israel to be involved in scientific collaboration in the most advanced research and development in the world.

However, the agreement came with a compromise formula in two appendices. The EU stated that the June 2013 guidelines regarding the Israeli settlements reflected European policy and would remain. Israel wrote it did not accept the validity of the guidelines but it will abide by the arrangement that no scientific funding by the EU will go to the disputed areas. Israel's position is that the fate of those areas will be decided by final status negotiations. Israel noted the two sides disagreed on the settlements but it insists that acceptance of the appendices on the EU guidelines does not constitute a legal or political precedent.

Cutting off ties with the EU would be detrimental to Israeli scientific research. But can the agreement be regarded as capitulation by Israel and acquiescence in the EU's partial boycott? Warning signs are already there in at least three cases where European firms have succumbed to the pressure of the Palestinian boycott campaign.

In Holland, the large water company Vitens in December 2013 cancelled its contract with Mekorot, the Israeli water company which supplies water to Israeli cities in the West Bank. Perhaps hypocritically, Vitens nevertheless cooperates in the Gaza Strip with a water company controlled by Hamas, which even the EU has designated a terrorist body. Another Dutch company, Royal Haskoning DHV engineering company, has cancelled building an Israeli sewage plant because it was across the Green Line.

The transport division of the French multinational company Veolia had participated in the building and maintenance of the Jerusalem Light Rail system, owned a 5% share in the rail company, and had a contract to build eight lines across the city. Bowing to Palestinian pressure and EU guidelines, Veolia has withdrawn from all Israeli transport and sold its rail shares.

It is clear that Israel cannot reduce trade ties with the EU or discontinue scientific cooperation. The EU-Israel Association Agreement in force since June 2000 is the legal basis for trade between the two. That trade is and will remain considerable: in 2011 it amounted to almost 30 billion euros. The EU is Israel's major source of imports (34.5%) and the second largest market for exports (26.1%) behind the U.S. Since January 2010 an agreement on agricultural products and fish has been in force.

But, ignoring the advice of Irving Berlin's song, Israel cannot put all its eggs in one basket. There is a world elsewhere, especially countries that are unlikely to succumb to BDS pressure and do not treat the Palestinian issue as the world's most significant cause to which they should pay obeisance. Israel has recognized it must strengthen trade, scientific, and hopefully political, relations with other states beyond Europe. It is now doing so with China, India, and Russia.

In contrast to the cautious approach of the nations and businesses in the EU, China has been eager to enter into negotiations with Israel. It is more interested in Israeli technology that in alleged problems of Palestinian rights. A Chinese-Israeli agreement has been reached for the creation in 2014 of the Nanxun Innovation Industrial Park in the city of Huzhou. The park will be concerned with research and development in a number of fields: energy conservation and environment protection, medical instruments, electronic information, and clean energy. Already, cooperation between the two countries exists in the Water Industrial Park in Dangguan.

A Chinese-Israeli task force for economic growth has been set up that will be concerned with issues of agriculture, water management, global transportation, and heath care. Though China did not establish normal diplomatic relations with Israel until 1992, it now has closer links. Bilateral trade in 2005 was $3 billion; in 2012 it increased to $8 billion, and is forecast to increase substantially.

Israeli trade with India has also been increasing: in 2013 it amounted to $6 billion.

Industrial relationships have been strengthened, particularly with the establishment of an industrial investment fund with Gujarat in Northwest India. These initiatives add to the existing cooperation in solar and thermal power, pharmaceuticals, water recycling and desalination, and in advanced agriculture technologies. The two countries are working towards a Free Trade Agreement.

Similarly, Israel is increasing trade with a considerable number of other countries, especially those with high growth. With Russia trade is relatively small, amounting to $2 billion, half of it in diamonds a year; Russia is interested in Israeli technology and intellectual property and negotiations for a free trade treaty are now continuing.

Israel is involved with Mexico in high-tech irrigation and cyber security. The EU might note that the Mexican billionaire Carlos Slim, through his telecommunication company America Movil, is investing $60 million in Mobli, the Israeli photo and video sharing platform startup company. The EU might also note that investors in Mobli, who include Leonardo DiCaprio and Serena Williams, have not succumbed to Palestinian pressure to boycott any Israeli places or businesses.

Now that relations between Israel and the Obama administration have become less warm than in previous years, Israel is adroitly cultivating political as well as economic ties with countries in different parts of the world, including Russia, Asia, the Gulf states, and Saudi Arabia.The partner nations in this harmonious peaceful process advantageous to all sides put to shame those countries, including EU member states, and organizations within them, whose deference to anti-Israeli elements has prevented or restricted similar harmonious relationships. Those latter countries and organizations not only have succumbed to foreign pressure; they have also limited their own financial growth and development.

Michael Curtis is author of Jews, Antisemitism, and the Middle East.