Skip to content
CityAM
Main navigation
  • News
    • News
      • Latest Business News
      • Economics
      • Politics
      • Tech
      • Banking
      • FTSE 100 Live
      • Retail
      • Insurance
      • Legal
      • Property
      • Transport
      • Markets
    • From our partners
      • AON
      • Bayes Business School
      • Canada BIDs
      • Central London Alliance CIC
      • Destination City
      • Halkin
      • Olympia
      • Inside Saudi
      • Tottenham Hotspur Stadium
      • Santander X
      • YEAR SIX Dividend
    • Featured

      Labour ‘political point-scoring’ over bank rules risks investment exodus, top Nomura exec warns

      Ordinary workers are likely to be hit hardest by salary sacrifice changes

      Submit a story

      Tell us your story.

      Submit
  • Opinion
  • Sport
    • Latest Sports News
      • Sport
      • Sport Business
    • From our partners
      • The Morning Briefing: SBS x CityAM
      • Aramco Team Series
      • LIV Golf
    • Featured

      Royal Ascot worth £140m to UK economy

      Breaking news scene with journalists and cameras outside a government building, capturing a press conference in progress.

      Submit a story

      Tell us your story.

      Submit
  • Life&Style
    • Life&Style
      • Life&Style
      • Toast the City Awards
      • The Magazine
      • Travel
      • Culture
      • Motoring
      • Wellness
      • The RED BULLETiN
      • Do it with Shared Ownership
      • Media Speak Hub
    • Featured

      Old Pulteney releases 50-year-old whisky for 200th anniversary

      Old Pulteney 50-Year-Old single malt Scotch whisky bottle with elegant packaging on display, highlighting luxury and craft...

      Submit a story

      Tell us your story.

      Submit
  • Investec
  • Events
  • Latest Paper
Tuesday 20 May 2025 4:38 pm  |  Updated:  Wednesday 21 May 2025 3:36 pm

UK halts trade talks with Israel

By: Ali Lyon

Chief reporter

Add as a preferred source on Google
David Lammy has been appointed deputy prime minister and justice secretary. (PA)
David Lammy was appointed deputy prime minister and justice secretary. (PA)

The UK has paused trade deal negotiations with Israel in response to its military offensive in Gaza, the foreign secretary has said.

Speaking in the Commons, David Lammy confirmed that negotiations with the Israeli government over a bilateral trade pact have been put on ice until the country ensures “unhindered provision of aid”.

“We have suspended negotiations with this Israeli government on a new free trade agreement,” Lammy told MPs. “We will be reviewing co-operation with them under the 2030 bilateral roadmap.”

Lamy added that “the Netanyahu government’s actions have made this necessary.”

The decision represents a further ratcheting up of tensions between Israel and the UK, after Prime Minister Keir Starmer’s administration joined France’s Emmanuel Macron and Canada’s Mark Carney in condemning Israel’s latest offensive in Gaza.

Play Video

The three leaders wrote that they “strongly oppose” the highly controversial military action in the western strip of Palestine, which had included a decision to prevent aid from entering the country for 11 weeks.

Israel claims to have brought that blockade to a partial end earlier this week, with the commitment to temporarily let a “minimal” amount of food into Gaza following pressure from US politicians.

But the end to the full block has been branded a “drop in the ocean” by humanitarian organisations, and did not prevent the three Western leaders from calling on Israel to “stop its military actions”.

Read more

As it happened: Stocks shrug off stalling Iran peace talks; OBR warns Reeves

Breaking news event with gathered crowd and journalists capturing the moment in a bustling city location

“We will not stand by while the Netanyahu government pursues these egregious actions,” they wrote.

Netanyahu reacted furiously to the intervention, branding it a “huge prize” for terrorist organisation Hamas.

Trade halted until aid blockades lifted

The decision to pause talks represents a further ratcheting up of tensions between the UK and Israel, which have traditionally been close allies. But addressing MPs, Lammy stressed the government’s issue was with decisions made by the current Israeli administration, rather than the country as a whole.

“I say now to the people of Israel, we want a strong friendship with you based on shared values and with flourishing ties between our people and societies,” he said.

“The conduct of the war in Gaza is damaging our relationship with your government. And… if Israel pursues this military offensive as it has threatened, failing to ensure the unhindered provision of aid, we will take further action in response.”

The government had been eyeing up closer economic ties with several Middle East countries as the next frontier of its trade push, having inked deals with the US, India and Europe in the past month.

Negotiations to upgrade its existing free-trade agreement with Israel began in 2022. Labour had reaffirmed its plans to resume talks on entering office last July, even after Israeli officials condemned a government decision to suspend some arms exports to Israel in September last year.

Read more

Iran ‘pulls out of talks with US’ and threatens to strike Israel

Iranian military vessels patrol the strategic Strait of Hormuz amidst escalating tensions in the region

Share this article

  • Facebook
  • X
  • LinkedIn
  • WhatsApp
  • Email

Similarly tagged content:

Sections

  • News

Categories

  • Business
  • Politics

People & Organisations

  • David Lammy
  • Gaza
  • House of Commons
  • Israel
  • trade
  • trade deal

Trending Articles

  • As it happened: FTSE 100 relief rally runs out of steam as BP and Shell weigh; Oil hits three-month low

  • London Tech Week sums up everything wrong with UK tech

  • KPMG’s Summer Friday half-day rollback signals deeper woes for Big Four giants

  • Rolls-Royce shares surge as SMR unit bags multi-billion pound Swedish nuclear contract

  • Inflation expectations at record high in interest rates signal

More from CityAM

  • As it happened: Stocks shrug off stalling Iran peace talks; OBR warns Reeves

    Markets
    Breaking news event with gathered crowd and journalists capturing the moment in a bustling city location
  • Iran ‘pulls out of talks with US’ and threatens to strike Israel

    Politics
    Iranian military vessels patrol the strategic Strait of Hormuz amidst escalating tensions in the region
  • Reeves warned Iran war oil shock will lead to government borrowing spike

    Economics
    Rachel Reeves speaking at an IOD event.
  • David Lammy rejects higher pay rise for judges amid recruitment crisis

    Legal
    David Lammy speaking at a podium during a press conference, wearing a suit and addressing the audience with a serious expr...
  • US and Iran agree to peace deal’s text, negotiators say

    Economics
    Aerial view of Strait of Hormuz with cargo ships navigating the strategic waterway under clear blue skies
  • Iran deal is ‘largely negotiated’ as Trump teases Strait of Hormuz re-opening

    Politics
    Donald Trump discussing the Iran nuclear deal, standing at a podium with the American flag in the background
  • Deputy PM to unveil AI labs to drag legal sector out of ‘analogue’ age

    Legal
    David Lammy speaking at a press conference, addressing key issues in current political landscape, wearing a formal suit.
  • Borrowing costs fall as interest rate hike fears ease

    Economics
    Keanu Reeves seen casually dressed during a public appearance in a local pub, engaging with fans and enjoying a relaxed at...
  • Terms & Conditions
  • Privacy Policy
  • Cookie Policy
  • News
  • Markets & Economics
  • Politics
  • Opinion
  • Life&Style
  • Personal Finance

Follow us for breaking news and latest updates

  • Facebook
  • X
  • Instagram
  • LinkedIn
Copyright 2026 CityAM Limited