After UK bans Israeli settlement goods, what happens to £6b UK-Israel trade?

Britain has imposed a ban on trade with Israeli settlements in the occupied West Bank, affecting goods and services worth about £6 billion ($8.1 billion) in 2025, according to British government figures. While this ban is likely to have a more significant political impact on Israel than an economic one, it does not ban the £6 billion trade relationship between the two countries in total.

The ban targets settlement-related goods and services, aiming to pressure Israel over the expansion of settlements and settler violence, which Britain believes threatens the possibility of a future Palestinian state. The ban applies to imports of all goods originating from Israeli settlements in the West Bank, as well as services supporting settlements, financing, construction, infrastructure, real estate, and advertising linked to settlement expansion.

New export licences will also be refused for items materially contributing to the occupation. The ban is intended to be enforced within six to nine months and comes amidst growing international pressure on Israel. Other countries, including France and Canada, have announced similar restrictions, and a 12-country group has backed national or European restrictions on trade with settlements.