An Israeli ministerial council will convene on Wednesday to discuss Israel's growing fears of future European boycotts over the settlements in the occupied Palestinian territories.
According to the Israeli newspaper Haaretz, this is the first time the Israeli government is seriously debating "strategies to counter European boycotts".
Haaretz reported a senior government official saying that the ministerial meeting was called in response to the Dutch firm PGGM's announcement earlier this month that it is divesting from five Israeli banks because of their links with settlements in the occupied Palestinian territories.
The Times of Israel news website also pointed out that numerous pension funds in Scandinavia and the Netherlands have already divested from Israeli defence contractor Elbit Systems over concerns about its activities in the occupied territories.
The EU has temporarily put a hold on discussions over labelling settlement products in its markets, a move that could harms Israeli sales, because it is working closely with the US in advancing the peace process. But if the US effort fails, the EU will put the issue of labelling on the table again.
Earlier this month, EU ambassador to Israel Lars Faaborg-Anderson told Israel's Channel 2 television that, "If the settlement business continues to expand, Israel will be facing increasing isolation."
The UK's ambassador to Israel, Matthew Gould, remarked that Israel is "losing support" internationally, and added he is worried that "in five years Israel will wake up and find that it does not have enough friends."