Economy
How illegal Israeli settlement goods still make their way to Europe
Goods tied to illegal Israeli settlements in the occupied Palestinian territories are still reaching European markets, prompting questions about how they are exported, labeled and distributed, and whether current European rules are doing enough to stop settlement-linked trade.
A June 2026 report by the Global Echo Litigation Center, Importing Occupation, has drawn fresh attention to these supply chains.
It says that goods made in Israeli illegal settlements have entered European markets through systems that hide their actual place of origin.
Here is how the system works.
How widespread is the trade?
The report focuses on agricultural exports, including dates, citrus fruits, herbs, fruit and vegetables, which have been recorded as among the most common settlement products reaching Europe by previous research.
To illustrate how the trade operates, Global Echo examined the supply chains of three major Israeli exporters: Hadiklaim, Mehadrin Ltd. and Yonatan Packing and Marketing.
It traced products from illegal settlement farms through packing facilities and Israeli ports before they entered European markets.
The actual scale of these trades has been unknown, as neither Israel nor the European Union releases comprehensive data on settlement exports.
The report says it analyzed more than 30,000 export documents covering more than 6,800 agricultural shipments between October 2017 and February 2026. Of the 5,900 shipments bound for Europe, 17.2% contained settlement products. For the EU specifically, the figure was 19.2%
The report says that farm products from Israeli settlements are not unusual or occasional, but are regularly part of Israel’s agricultural exports to Europe.
How do settlement products enter Europe?
According to the report, exporters use what it calls a “supply chain of obfuscation,” a system designed to hide the fact that products come from Israeli settlements and make their actual origin harder to identify.
The report describes three main methods.
The first is what it calls “hiding in plain sight.” In this method, exporters may include the actual settlement location, including its postal code, but still list Israel as the country of origin, excluding the fact that the goods were produced in a settlement.
The report says the responsibility falls on the European customs authorities, rather than Israeli exporters, for checking whether a postal code belongs to a settlement. It argues that this allows loopholes that allow settlement produce to enter European markets without being identified as such.
The second method involves what the report calls “sham addresses.” Exporters use addresses inside Israel instead of the actual production site, making settlement produce appear to have originated in Israel.
The third method is “mingling.”
Illegal settlement produce is mixed with goods grown inside Israel at shared packing or storage facilities before export. Once combined, the shipment carries Israeli origin documents, making it difficult for importers and customs officials to identify which products came from settlements.
What steps have European countries taken?
European countries have taken multiple approaches toward products originating from Israeli settlements, ranging from national import bans to calls for stronger EU-wide restrictions.
At the European Union level, there is still no bloc-wide ban on imports from Israeli settlements. But the issue has moved closer to EU-level action. In July, the European Commission presented member states with options including a full or partial import ban, prohibitive tariffs and an import-licensing system. EU foreign ministers discussed the proposals on July 13, with a full ban receiving the most support, but no agreement was reached and further work was ordered.
The Netherlands has adopted a national ban on the import, purchase and sale of goods from Israeli settlements in the occupied Palestinian territories. The measure also prohibits circumvention and is due to take effect on Sept. 22, 2026.
Ireland has also advanced legislation to prohibit imports of goods originating in Israeli settlements. The government approved the Israeli Settlements (Prohibition of Importation of Goods) Bill 2026 in May, and the bill subsequently passed through the Irish parliament in July. Once enacted and commenced, importing settlement goods will be an offence.
Spain has already banned the import of products originating in Israeli settlements in the occupied Palestinian territory. Belgium has also approved a ban on imports from Israeli settlements, while supporting stronger EU-wide action.
France and Sweden have pushed for a common European approach rather than separate national measures. In an April 2026 letter to the European Commission, France and Sweden called for additional measures targeting settlement products, including tariffs and restrictions through export-licensing schemes.
Why does the system continue to function?
Global Echo argues that responsibility is divided between Israeli exporters and European authorities.
Researchers say they identified hundreds of origin certificates that appeared to relate to settlement products while claiming preferential treatment available under the EU-Israel Association Agreement.
The report also questions the validity of plant health certificates and organic certifications issued for products originating in occupied territory, arguing they may not comply with EU legal requirements.
According to the report, the current system places the burden of identifying settlement postal codes on European authorities rather than Israeli exporters, creating opportunities for settlement products to go undetected.
Finalists with AI- and 5G-driven ideas to make roads safer gathered at Istanbul Technical University (ITÜ) for the last stage of Turkcell’s “5G and Artificial Intelligence for Smart Road Safety Competition,” held as part of Teknofest 2026.
The competition, organized in cooperation with the T3 Foundation, attracted 745 teams from more than 150 universities across 11 countries, including Türkiye, Azerbaijan and the Turkish Republic of Northern Cyprus (TRNC).
Twenty teams advanced to the final round after qualifying through preliminary stages involving 163 shortlisted teams.
Finalists tested their solutions using Türkiye’s domestically produced Togg electric vehicle, developing systems designed to detect road hazards and driver errors by combining artificial intelligence with 5G connectivity.
Turkcell CEO Ali Taha Koç said technology gains value when it addresses real needs.
“At Turkcell, we have been supporting the dreams and goals of our young people for 32 years. The Smart Road Safety Competition, featuring 5G and Artificial Intelligence, is a reflection of this vision. It is also a highly valuable initiative that showcases our young people’s potential to create technology,” Koç said.
He recalled the launch of 5G in Türkiye this April.
“5G now transmits data at high speed, artificial intelligence gives meaning to that data, and human intelligence directs technology,” said Koç.
“Our young finalists have combined these capabilities to create safer roads. Every project they have presented also makes a concrete contribution to Türkiye’s National Technology Initiative,” he noted.
“Developing smart road safety systems using domestic technologies is of strategic importance for Türkiye’s digital future.”
The competition focused on demonstrating how 5G’s low-latency connectivity and artificial intelligence can be integrated into intelligent transportation systems.
Teams developed applications capable of analyzing data in real time while dynamically managing network resources. Participants also utilized GSMA Open Gateway standards, including Number Verification services that enable password-free user authentication, and Quality on Demand technology to ensure low-latency, high-quality connectivity for mission-critical applications.
Three special awards were presented during the final round. The Polaris team from Çukurova University won the Best Application Architecture Award, while the university’s Eureka team received the Best Presentation Award. The Turkcell Special Award went to the Mimik team from Karadeniz Technical University.
The winners of the overall competition will be announced during this year’s edition of Teknofest, the country’s largest aerospace and technology festival, which will be held in southeastern Şanlıurfa province from Sept. 30 to Oct. 4.
The number of household air conditioners in Türkiye and the electricity they consume are expected to double over the next decade as rising temperatures and more frequent heatwaves boost cooling demand, projections showed Monday.
The Energy and Natural Resources Ministry said household air conditioner stock was estimated at around 11 million units as of the end of 2025, with projections indicating that figure will increase by 100% over the next 10 years.
As ownership rises, electricity consumption from residential air conditioners used for both heating and cooling is expected to climb from about 6,000 gigawatt-hours (GWh) in 2025 to more than 12,000 GWh by 2035, according to ministry experts.
The ministry said increasingly hot summers and more frequent heatwaves linked to climate change have led to a steady increase in air conditioner use in recent years.
Growing cooling demand has become an increasingly important driver of electricity consumption during the summer months, with heavy air conditioner use contributing to record daily power demand during periods of extreme heat.
Officials expect this trend to become more pronounced over the coming years as climate change intensifies and household air conditioner ownership becomes more widespread.
The ministry said one of the simplest ways to limit the impact of rising air conditioner use on electricity consumption is to set cooling systems at an appropriate temperature.
It recommends maintaining indoor temperatures at no lower than 24 degrees Celsius during the summer, saying the setting strikes a balance between comfort and energy efficiency.
According to the ministry’s analysis, raising an air conditioner’s temperature setting by 2 degrees Celsius can reduce electricity consumption and energy bills by up to 15%.
The ministry warned that setting air conditioners to unnecessarily low temperatures significantly increases electricity use, adding that efficient operation will become increasingly important as cooling demand continues to grow.
Opel is moving production of its light commercial vehicle model Combo to Türkiye from the third quarter of this year, the German automaker said Monday.
The announcement comes just two weeks after another Stellantis-owned carmaker, Peugeot, said it would begin producing its Rifter light commercial vehicle in Türkiye.
The Combo will be manufactured at a Turkish carmaker Tofaş’s plant in the northwestern Bursa province. Peugeot’s Rifter will also be produced at the same factory.
The Bursa plant will add the Combo to Opel’s locally produced commercial vehicle lineup, following the start of production of the Zafira, Vivaro and Vivaro Van models at the facility.
Opel Türkiye Brand Director Yiğit Yantaç said restarting production in Türkiye carried both strategic and emotional significance for the brand.
“Bringing the Combo to life in Bursa with Turkish engineering and Tofaş’s manufacturing strength brings together two different engineering cultures,” Yantaç said.
Local production is expected to improve efficiency across Opel’s supply, logistics and operational processes.
Combo leads Opel’s commercial vehicle sales
The Combo accounts for a significant share of Opel’s light commercial vehicle sales in Türkiye.
Opel sold 27,471 light commercial vehicles in the country in 2025, making it the third-best-selling brand in the segment. Combo sales accounted for 15,722 of those vehicles.
The latest Combo features Opel’s signature Vizor front design, a digital cockpit and advanced driver-assistance systems. It is also equipped with Intelli-Lux LED Matrix headlights.
The model is offered in Essential, Edition and Ultimate trim levels and is powered by a 1.5-liter diesel engine producing 130 horsepower, paired with either a six-speed manual or eight-speed automatic transmission.
Combo maintained its sales momentum in the first seven months of 2026, with 7,779 units sold and an approximately 15% share of the C-Combivan segment.
Just over a year ago, Chinese ultra-fast fashion retailer Shein began leasing 15 hectares of warehouse space near Ho Chi Minh City – about the size of 21 football fields – as part of a grand experiment to make Vietnam a major export base.
When it was formulating those plans in late 2024, it seemed like a bet that, while risky, was worth making.
U.S. exemptions for duties on small parcels from China that underpinned its business model looked as if they would be abolished, Donald Trump had just been elected U.S. president for a second term and fears of a heightened trade war were soon realized, with U.S. tariffs on many Chinese goods rocketing to 145% by April 2025.
Shein started encouraging its biggest Chinese suppliers to set up manufacturing bases in Vietnam.
But things did not go to plan.
Today, IPO-bound Shein, known for selling $5 tops and $10 dresses, is drastically scaling back in Vietnam, according to a Reuters report, citing six people familiar with its operations there.
At 15 hectares, the bonded logistics hub was the largest of its kind in the country and used to employ thousands. The lease now covers 6 hectares, according to two of the sources. A separate person with direct knowledge of the matter said a third of the originally planned site is in use.
Mass layoffs began in April and more are expected, warehouse workers said, adding that some teams have retained one in four employees, while others lost even more. During a Reuters visit to the site in late July, only a handful of workers were present and just a few trucks were parked at its warehouses. Nearby warehouses operated by other tenants were bustling with activity.
Its sharp U-turn in Vietnam, which has not previously been reported, reflects abrupt changes in U.S. trade policies while underscoring how dependent Shein’s business model is on Chinese suppliers, which put up with terms that manufacturers in other countries won’t – a pattern Shein has also seen play out in Brazil.
It also highlights how Shein is hewing more closely to its Chinese roots. Having unsuccessfully sought listings in New York and London and moved its headquarters to Singapore as it expanded globally, the company is now pursuing a Hong Kong IPO while deepening its commitment to its manufacturing base in southern China.
De minimis pain quite major
The first and biggest hit to Shein’s Vietnam plans was the end of the U.S. de minimis duty-free exemption for shipments under $800 from all countries, not just China. Trump ordered the move on July 30, 2025, and it took effect a month later, only a few months after the exemption for shipments from China ended.
Then, sky-high U.S. tariffs on Chinese goods gradually came down. Vietnamese apparel is still subject to smaller tariffs than Chinese clothing, but the advantage is no longer as large as it used to be.
A knit polyester dress, for example, imported from either Vietnam or China is subject to a 16% duty, but the Chinese item would be hit with Section 301 tariffs imposed for alleged unfair trade practices that could lift the effective rate to around 33.5%.
Last month, both China and Vietnam were hit with new U.S. tariffs of 12.5% for allegedly failing to prevent imports of goods made with forced labor – a decision that puts Vietnam at a disadvantage to other Southeast Asian nations with big apparel sectors and further undermines the case for Shein’s suppliers to set up shop there.
Home base unmatched for speed, low margins
It’s not all about tariffs. Finding Vietnamese workers willing to work long hours for low wages has proven difficult, sources at Shein’s Chinese suppliers say.
Shein’s vast network of suppliers in China produces millions of styles in small batches at margins of as little as 1 yuan ($0.15) per piece, with orders fulfilled in days and quickly reordered if the company’s 273 million shoppers take a liking to them.
“Sourcing diversification beyond China has practical limits, especially for companies like Shein whose competitive advantage depends on speed, flexibility, and extremely small production runs,” said Sheng Lu, professor of fashion and apparel studies at the University of Delaware.
Many suppliers that went to Vietnam have come back, said a factory manager with the surname Wen in Guangzhou’s Panyu district, home to “Shein villages” that comprise thousands of small garment factories.
“They realized that despite the smaller U.S. tariff rate on Vietnamese goods compared to Chinese ones, the low efficiency still makes it less viable than manufacturing in China,” Wen added. He declined to give his full name, saying Shein had warned suppliers not to speak to the media.
Authorities in Guangzhou, keen to protect local jobs, were also not happy with Shein’s efforts to subsidize Chinese manufacturers opening plants in Vietnam, and in mid-2025 warned it against moving orders significantly away from the region, according to a source with direct knowledge of the matter.
Shein is now investing further in Guangzhou and the broader Guangdong province, with CEO Sky Xu making a rare public appearance in February to pledge spending of over 10 billion yuan ($1.5 billion) on a smart supply-chain system in the region.
Commitment doesn’t go both ways
But while Shein has recommitted to China, some domestic suppliers are not necessarily recommitting back as demand slows. Shein’s draft prospectus showed a 14% slide in U.S. revenue during the first quarter due to the end of the de minimis exemption.
Wen and three other suppliers said orders from Shein were either stagnant or showing only a little growth. Demand is expected to further slow after the European Union last month imposed a 3-euro ($3.46) duty on low-value e-commerce imports.
Ping He, who has worked in operations management for Shein and TikTok Shop, said thousands of Shein’s smaller suppliers have begun supplementing their income by opening stores on PDD Holdings-owned Temu or Amazon.
“Shein is not the prettiest boy in town anymore. There are many more options now,” she said.
Other suppliers are returning to larger orders with longer lead times.
“Shein’s profit margins are just too thin … their order volumes are quite small, often just dozens of pieces at a time, which makes production a hassle. So we decided to drop them,” said Yang, a manager at Jiang Gong Clothes, a factory in Panyu that worked with Shein until a few months ago.
Demand conditions across Türkiye’s key export markets strengthened at the fastest pace in eight months in July, driven by renewed growth in major European economies and stronger activity in the United States, a survey showed Monday.
The Türkiye Export Climate Index, compiled by the Istanbul Chamber of Industry (ISO) and S&P Global to measure business conditions in the main export destinations of Turkish manufacturers, rose to 52.2 in July from 50.4 in June.
Readings above 50 indicate improving business conditions in export markets, while those below 50 point to deterioration.
The July reading marked the greatest improvement since November 2025 and extended the index’s uninterrupted expansion that began in January 2024.
The survey showed economic activity increased in eight of Türkiye’s 10 largest manufacturing export markets during July, with only France and Poland recording contractions.
Germany, Türkiye’s largest export destination, returned to growth for the first time in four months, albeit at a modest pace.
The United Kingdom also resumed expansion. Together, Germany and the U.K. account for around 15% of Türkiye’s manufacturing exports.
Rapid growth in U.S, Europe
The United States posted its fastest rate of economic growth in nine months, while Italy recorded its strongest expansion in eight months. Economic activity in Spain accelerated to its highest level in about 18 months.
Elsewhere, growth strengthened in the Netherlands and the United Arab Emirates (UAE), while Romania’s manufacturing sector returned to expansion after 25 consecutive months of contraction.
Although economic activity declined in France and Poland, the pace of contraction eased compared with June.
Among all economies monitored by the survey, Egypt recorded the steepest contraction in output, though the decline was the mildest since March. Uganda registered the fastest growth, followed by Thailand and Singapore.
Outlook improves despite geopolitical risks
Andrew Harker, economics director at S&P Global Market Intelligence, said the latest data suggest the global economy started the second half of the year on a firmer footing, creating better opportunities for Turkish exporters.
“Growth signals from some of Türkiye’s key export markets clearly show that the global economy made a positive start to the second half of the year,” Harker said.
“Most major export markets either returned to growth or saw stronger expansion in July. These developments provided manufacturers with more opportunities to secure new business,” he added.
However, Harker said continued uncertainty surrounding the Middle East suggests the outlook could remain volatile in the coming months.
Türkiye’s industrial production expanded in the second quarter despite challenging global conditions, Treasury and Finance Minister Mehmet Şimşek said Monday.
Şimşek’s remarks came after the Turkish Statistical Institute (TurkStat) data showed industrial output grew 1.9% year-over-year in the April-June period.
In a post on X, Şimşek highlighted what he said was continued growth in high-technology manufacturing and an improving export mix.
He added that production in high-technology industries increased 3.9% in the second quarter, while the share of medium-high and high-technology products in manufacturing exports reached 44.5% as of June.
“The strong increase in value-added production and the improvement in the composition of exports are concrete indicators of the transformation taking place in industry,” Şimşek said.
“Through our productivity-focused policies, we will continue moving up the global value chains,” he added.
The TurkStat data showed the industrial production index fell 1.4% year-over-year in June, the steepest annual decline since January 2026.
On a monthly basis, however, industrial output edged up 0.1%.
According to TurkStat, manufacturing output, the largest component of industrial production, declined 1.5% from a year earlier in June, while mining and quarrying production fell 1.6%.
Output in the electricity, gas, steam and air conditioning supply sector rose 1.1% on an annual basis.
Compared with May, mining and quarrying output declined 0.5%, manufacturing production was unchanged, while electricity and utilities output increased 1.5%.
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