After years in which relations between the European Union and Israel have been frosty, bilateral ties will take a significant leap forward in 2017, senior officials from both sides said this week.

In one notable sign of such warming ties, Jerusalem and the EU are in advanced talks over convening the EU-Israel Association Council, a bilateral forum on ministerial level, early next year. The last such meeting took place in 2012.

“Quite a lot of good things are happening, often unseen by the naked eye, but they are there,” Nicholas Westcott, the director of the EU External Action Service’s North Africa and Middle East department, said this week during a visit in Tel Aviv. “We hope early next year to have an Association Council, which we haven’t had for a while, to look at a ministerial level how we can take the relationship forward.”

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If a EU-Israel Association Council meeting were to be held in 2017, the EU would likely be represented by its foreign policy chief Federica Mogherini and Israel by Minister Tzachi Hanegbi, The Times of Israel has learned.

In addition, the EU “would like to develop something we call partnership priorities,” said Westcott, who is the second-most senior EU diplomat dealing with the Middle East, after Mogherini. The so-called partnership priorities are a new instrument regulating bilateral ties that emerged of the EU’s 2015 review of its neighborhood policy program.

Visiting Jerusalem this week for the second time since he took over his position, Westcott met with various senior officials in the Foreign Ministry, the Prime Minister’s Office and COGAT, the branch of the Israeli army that deals with civilian matters in the West Bank.

“The main focus was on EU-Israel cooperation, which is moving in a relatively positive direction,” he said. “We are looking at areas where we can deepen cooperation within the existing framework and beginning to think about what the next generation of framework might be.”

The anticipated rapprochement does not entail a formal upgrade of ties. But several officials from both sides said this week that there are clear indications that Israel and the EU will improve bilateral relations in various ways. This is projected to happen despite remaining differences of opinion, such as the union’s vehement opposition to settlement expansion and Israeli demolitions of EU-funded structures in Area C of the West Bank.

There are “significant signs that the bilateral relationship is making progress and going forward,” one senior EU official said, speaking on the condition of anonymity.

Foreign Ministry spokesperson Emmanuel Nahshon concurred with that assessment and confirmed ongoing talks over convening the EU-Israel Association Council in the near future. He added that this particular forum is just one of various expressions of ongoing bilateral dialogue between Jerusalem and Brussels, such as the annual EU-Israel Seminar on Combating Racism, Xenophobia and Antisemitism, which is taking place later this month.

Last planned major update in ties fell over Cast Lead

After the 11th and last meeting of the EU-Israel Association Council, held in July 2012 in Brussels, the union said it viewed the event as a “demonstration of the significance the EU attaches to its relations with the State of Israel.” The council meeting reiterated the “importance of further developing our broad bilateral partnership,” the EU said in a statement at the time.

But in July 2013 the EU angered Israel by issuing new regulations according to which no Israeli body that operates or has links beyond the Green Line can receive EU funding or have any cooperation with the EU.

Jerusalem replied by vowing not sign any further agreements with the European Union until the EU “clarifies” its new regulations. In the wake of the heated arguments over the so-called guidelines, no Association Council was held that year and in the following years.

EU-Israel relations took another hit in November 2015, when the union instructed its member states to label certain Israeli goods made outside the pre-1967 lines. Israeli officials fumed and, amid accusations of anti-Semitism, vowed to curtail bilateral ties.

“We have to reset our relationship with the EU,” Prime Minister Benjamin Netanyahu said in January. “There is a natural tendency in the EU establishment to single out Israel and treat it in ways that other countries are not being dealt with, and especially other democracies,” he said. “And I think it’s wrong. I think it should be corrected.”

‘We think that making progress on the peace process is important for overall regional stability’

However, after a meeting with Mogherini the following month, Netanyahu said he was ready to bury the hatchet.

“Israel and the European Union have agreed to put relations between us back on track,” he declared. Mogherini had assured him that the labeling was “non-binding” and does not reflect the EU’s position on Israel’s final borders, he added.

“Of course, this is not to say that there will not be friction. There are things that we do not agree on,” he said.

Indeed, the EU’s longstanding opposition to Israeli settlement expansions has been one of the key sources of tensions in the bilateral relationship, which are anchored in the EU-Israel Association Agreement from 2000.

In 2005, the two parties agreed upon a so-called Action Plan, an important bilateral agreement that sought to “gradually integrate Israel into European policies and programmes.”

In 2008, the two sides agreed to upgrade the Action Plan, but due to the break out of Israel’s Operation Cast Lead against Hamas in Gaza a few months later — and ongoing arguments over settlement buildings — Brussels froze these negotiations.

The current rapprochement between Israel and the EU is in its fragile early stages and does not entail plans for negotiations over a new Action Plan, officials from both sides stressed this week. However, the current Action Plan remains in force.

Despite the expected detente, the union remains strongly opposed to Israel’s construction of housing units beyond the Green Line. Westcott, the senior EU official, said in Tel Aviv this week, called on Israel to take urgent steps to reach a peace agreement with the Palestinians.

Fascinating tour round Jerusalem with Danny Seidemann, a fount of knowledge on developments there. pic.twitter.com/g9DLCCSrcD — Nick Westcott (@NickWestcottEU) November 30, 2016

“We do not regard the status quo as indefinitely stable. It will become increasingly unstable, in unpredictable ways,” he said. “Something will give — might be sooner, might be later. But it’s not sustainable, so we still have to find a better solution than the status quo. It’s not a stable status quo, it’s evolving all the time. And you never know at what point it will tip, and which way it will tip.”

Westcott disagreed with the assertion, often made by Netanyahu and other Israeli leaders, that the current turmoil in the region means that Israel must not rush to make territorial concessions.

“Regional instability and uncertainty over the Middle East generally is a factor that makes it, from an EU point of view, more important to make progress with the peace process, rather than less,” he said. “We think that making progress on the peace process is important for overall regional stability.”

Westcott also said he sees an improvement regarding Palestinian incitement against Israelis. The Israeli government has recently brought to his attention “one or two” examples of incitement, “but not a lot,” he told The Times of Israel.

It is possible that Palestinian leaders have realized, in light of increasing international criticism, that incitement is unhelpful in their bid to reach an agreement with Israel, Westcott continued. “And the Palestinians have an interest in creating a conducive environment for a two-state solution.”