In major shift, Pompeo says US to label settlement products ‘Made in Israel’

Unclear whether White House was consulted before secretary of state announced change, which marks latest American endorsement of Israeli presence beyond Green Line

Jacob Magid is The Times of Israel's US correspondent based in New York

US Ambassador to Israel David Friedman (L) and US Secretary of State Mike Pompeo (2nd L) during a visit to the Psagot Winery in the West Bank, on November 19, 2020. (State Department/Twitter)
US Ambassador to Israel David Friedman (L) and US Secretary of State Mike Pompeo (2nd L) during a visit to the Psagot Winery in the West Bank, on November 19, 2020. (State Department/Twitter)

US Secretary of State Mike Pompeo on Thursday announced new guidelines that will require goods made in Israeli controlled areas of the West Bank to be labeled as “Made in Israel,” following an unprecedented visit to a settlement winery on Thursday afternoon.

Until now, US policy has required products made in the West Bank to be labeled as such. But with Pompeo’s newly announced rules, which he said were “consistent with our reality-based foreign policy approach,” all producers within areas where Israel exercises authority — most notably Area C under the Oslo Accords – will be required to mark goods as ’Israel,’ ’Product of Israel,’ or ‘Made in Israel’ when exporting to the United States.

The announcement appeared to indicate that the policy would also cover goods made in Palestinian villages within Area C, where Israel exercises both civilian and security control. The State Department did not immediately respond to a request for clarification of the matter. Roughly 150,000 Palestinians are believed to live in Area C, which includes all Israeli settlements and covers about 60 percent of the West Bank’s land area.

The statement from Pompeo said the new policy “recognizes that Area C producers operate within the economic and administrative framework of Israel and their goods should be treated accordingly.”

Pompeo said it would “eliminate the confusion” that may have been caused by the old policy, which in labeling all West Bank exports as having been made there, did not differentiate whether the producers were Israeli or Palestinian.

US exports made in Areas A and B of the West Bank, under Palestinian Authority control, must still be marked as “Made in the West Bank.”

“We will no longer accept “West Bank/Gaza” or similar markings, in recognition that Gaza and the West Bank are politically and administratively separate and should be treated accordingly,” the State Department announcement said.

Pompeo insisted that the US still remains committed to achieving “sustainable peace” and will “continue to oppose those countries and international institutions which delegitimize or penalize Israel and Israeli producers in the West Bank through malicious measures that fail to recognize the reality on the ground.”

The concluding remark of the statement appeared to take a direct shot at the European Union, which has led a policy obliging all 28 member states to label exports produced in Israeli towns beyond the Green Line as having been made in the settlements.

Pompeo’s Twitter account posted several photos from the secretary of state’s visit to Psagot, including a picture of a nearby Palestinian village. That tweet was deleted less than an hour after it went up and replaced with an updated version without the picture of the Palestinian town.

It had been US policy since 1967 to differentiate between Israel and the territories it captured in the Six Day War. A 1995 Treasury Department guidance requiring goods from the West Bank or Gaza Strip to be labeled as such still remains in force. The directive was republished in 2016 by the Obama administration, which warned that labeling goods as “made in Israel” could lead to fines.

US Secretary of State Mike Pompeo (c), his wife Susan, and US Ambassador to Israel David Friedman at the City of David in Jerusalem on November 18, 2020 (Matty Stern/U.S. Embassy Jerusalem)

The new US doctrine appears to fall in line with existing Israeli policy, which similarly does not differentiate between goods produced on either side of the Green Line.

According to the Walla news site, the new policy had been pushed by Pompeo and US Ambassador to Israel David Friedman, who has extensive ties to the settlement movement, having once served as the chairman of the American Friends of Beit El Institutions.

“It’s unclear if the White House approved or even knew the announcement was coming,” Walla reported.

It is also unclear whether such a policy will hold under the incoming Biden administration.

Pompeo and Friedman are believed to run a more radical line on Israel within the administration, while Senior Adviser Jared Kushner and Special Envoy for International Negotiations Avi Berkowitz have pushed more moderate proposals on the Israeli-Palestinian issue.

The two flanks came at odds in January when, after US President Donald Trump unveiled his peace plan which envisioned Israel eventually annexing all West Bank settlements, Friedman told reporters that Jerusalem had Washington’s blessing to move forward with the step immediately.

Within hours though, Kushner put the breaks on the idea, clarifying that such a move would take time and would require a joint US-Israeli mapping team to demarcate the exact borders of the controversial move.

After six months went by with little progress made, Kushner led a team of US negotiators that saw Israel shelve its plan to annex some 30 percent of the West Bank — covering all the settlements and the Jordan Valley — as a condition of the normalization treaty with the United Arab Emirates. While both Israeli and US officials have insisted that annexation is not off the table for good, sources with direct knowledge of the matter told The Times of Israel that Kushner committed to not backing the move until at least 2024. With Democrat Joe Biden’s victory in this month’s presidential election, prospects of US approval for annexation have dimmed further.

Prime Minister Benjamin Netanyahu (L) greets US Secretary of State Mike Pompeo as he arrives at the Prime Minister’s Residence in Jerusalem on November 18, 2020. (Amos Ben Gershom/GPO)

The vast majority of the international community views Israeli settlements as illegal, but the Trump administration has taken several steps to shift US policy on the matter. Last year, Pompeo repudiated a 1978 State Department legal opinion maintaining that civilian settlements in the Palestinian territories are “inconsistent with international law.”

Last month, Friedman and Prime Minister Benjamin Netanyahu signed an agreement removing all previous geographic restrictions from their scientific cooperation.

Pompeo met with Netanyahu on Thursday morning in Jerusalem and updated the premier on his plan to announce the policy shift on labeling for settlement exports, Walla reported.

The doctrine appears to clash with the views of President-elect Joe Biden, who has long been a critic of Israeli settlement expansion, saying it places the viability of a two-state solution at risk. Biden has also spoken out against Netanyahu’s annexation plans. The Biden transition team declined to comment on the matter.

“The president-elect firmly believes in the principle that there must be only one president at a time guiding our country’s foreign policy and national security as he is focused on preparing to govern,” a spokesman said.

PA President Mahmoud Abbas’s spokesman Nabil Abu Rudeineh said in a statement that Pompeo’s announcement “blatantly violates international law.” He dismissed the policy change — along with the secretary of state’s visit to Psagot — as yet another biased, pro-Israeli move by the Trump administration.

Palestinians protest against an expected visit of US Secretary of State Mike Pompeo to the Jewish settlement of Psagot near the West Bank city of Al-Bireh, Nov. 18, 2020 (AP Photo/Majdi Mohammed)

The Israel director for the liberal lobby J Street said in a statement that Pompeo was “cooperating with the BDS movement” by refusing to differentiate between either side of the Green Line, thereby allowing Israel’s detractors to morph the two as well and deem Israel on both sides of the line as illegitimate.

“Instead of protecting Israeli exports, Pompeo’s decision could hurt them,” Adina Vogel-Ayalon said.

Rabbi Jill Jacobs, who runs the T’ruah rabbinic human rights organization, also blasted the policy change, tweeting “Who needs Netanyahu to annex Area C when the US government does it for him?”

“In Area C, Israeli citizens live under Israeli law; Palestinians live under occupation,” she wrote. “Annexation means either making Palestinians citizens of Israel or having 2 systems of law for 2 ppl inside state.”

For its part, the Yesha umbrella council of settler mayors lauded the move, calling it “an important milestone in the fight against the international boycott [of Israel] and the BDS movement.”

“The decision recognizes the reality on the ground that Judea, Samaria and the Jordan Valley are integral parts of the State of Israel,” the group added, referring to the West Bank by its biblical names.

Israeli winemaker Yaakov Berg holds a bottle of his red blend named after US Secretary of State Mike Pompeo at the Psagot Winery in the Sha’ar Binyamin industrial park near the Psagot settlement in the West Bank, north of Jerusalem on November 18, 2020. (Emmanuel DUNAND / AFP)

Diaspora Affairs Minister Omer Yankelevich from the Blue and White party lauded the decision, telling Army Radio that West Bank settlements are as much part of Israel as anywhere else in the country.

She also tweeted a photo of herself in the southern West Bank settlement of Sussiya holding a bottle of wine made in the nearby settlement of Yatir. “From today — made in Israel! Thank you Secretary of State Mike Pompeo,” the minister wrote.

Pompeo earlier Thursday announced another new policy, stating that from now on Washington would designate as “anti-Semitic” the Boycott, Divestment and Sanctions campaign, which seeks to isolate Israel over its treatment of the Palestinians, and would take practical steps against BDS groups.

Pompeo’s visit to the Psagot winery in the central West Bank was the first time a secretary of state had visited an Israeli settlement. Pompeo later made his way to the Golan Heights for the first visit to the plateau by a top US diplomat since Washington recognized Israeli sovereignty over the Golan last year.

Netanyahu thanked Pompeo for his “unwavering support” of Israel, first as CIA director and then as secretary of state, saying that under US President Donald Trump the US-Israeli relationship had “reached unprecedented heights.”

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