July 25, 2025, 06:00:02 (IST)
Israel-France tensions rise over Palestinian statehood, creating regional investment uncertainty
A significant diplomatic rift has emerged between Israel and France following statements from Israeli Prime Minister Benjamin Netanyahu, who warned French President Emmanuel Macron that a Palestinian state would serve as a ‘launch pad to annihilate Israel’, as per a report in Israel National News. This declaration, echoed by other Israeli officials who claim a potential Palestinian state would become a ‘Hamas state’, comes as France considers following other European nations like Spain, Ireland, and Norway in formally recognising Palestinian statehood. From a market perspective, the heightened rhetoric increases geopolitical uncertainty in West Asia, a critical factor that could influence investor sentiment, risk premiums, and potentially impact bilateral trade and technology cooperation between Israel and key European economies.