Widely publicised political tensions often don’t paint a full picture of the EU’s relationship to Israel; however, with SOMO, the Dutch Centre for Research on Multinational Corporations, publishing figures earlier this year about the level of investment made in Israel by European nations, that may come as a surprise.
In an article released in July, SOMO used IMF data to reveal that not only was the European economic bloc the biggest investor in Israel, but that one country within the bloc had made up a disproportionate amount of the total. In the context of its Eurovision boycott, it might seem a little strange that the Netherlands is not only the biggest investor in Israel of any EU country, but of any country in the world, even topping the United States.
EU member states held €72.1bn in foreign investment in Israel in 2023, compared to €39.2bn for the US, while the Netherlands alone held €50bn – making up two-thirds of all EU investment all on its own. For its part, Israel has invested €65.9bn in the EU, seven times as much as in the US (€8.8 bn), with €47.3bn of that total going to the Netherlands.
As a tax haven and so-called conduit country, the Netherlands is a recipient of a lot of Foreign Direct Investment or FDI, while also often serving as a base for other countries to invest through organisations based there. The Netherlands has over $5 trillion (€4.25bn) in foreign capital flowing through it, making it the second-largest source and destination of FDI in the world.
It is often utilised by investors to minimise global corporations’ tax bills through ‘phantom investments,’ where multinationals use nominal investments to take advantage of the Netherlands’ generous tax laws.
While this goes some way to explaining the Netherlands’ outsized presence in global investment in Israel, the Dutch press was inspired to look further into who was making these investments and into what Israeli industries.
In the same month as the SOMO’s investigation was published, the Dutch press scrutinised the investments of the country’s five largest pension funds, finding that three of them ABP, PFZW, and Bpfbouw had directed money towards companies the United Nations lists as “risking complicity in human rights violations” in Gaza by continuing to supply the Israeli army.
On the list are Rheinmetall, Caterpillar, ThyssenKrupp, Oshkosh, BAE Systems, Boeing, General Dynamics, Lockheed Martin, Northrop Grumman, Rolls-Royce, and RTX. Dutch outlet Volkskrant, found that ABP had a total of €674m in various companies on the list, PFZW had €149m, and Bpfbouw had €42m.
In October, it was announced that ABP had sold its shares in Caterpillar, due to concerns about the use of the company’s bulldozers in demolishing buildings in Gaza. ABP is the EU’s largest pension fund with assets totaling €534bn and represents three million Dutch citizens.
A report released in 2024 revealed that Dutch banking giant ING had invested more than €7.8bn in companies that listed activities “raise particular human rights concerns”, according to the UN database of business enterprises that are involved in Israeli settlements. Overall, the report found that from the period between January 2021 and September 2024, “Dutch financial institutions had €20.2bn in investments in companies operating in, or having business relations with, illegal Israeli settlements in the occupied West Bank.”
In total, they found 822 European financial institutions had given out loans equalling €180bn between January 2021 and August 2024 to 58 of these businesses.
Economic ties to Israel were put under further scrutiny when Francesca Albanese, the UN Special Rapporteur on the Occupied Palestinian Territory, released a report that accused companies and governments that support Israeli economic activity of being complicit in an ‘economy of occupation’.
She said, “Far too many corporate entities have profited from Israel’s economy of illegal occupation, apartheid and now, genocide”. While it was received well by some, the US sanctioned her in July 2025, accusing her of an “unacceptable campaign of political and economic warfare”.
Despite the outcry and some efforts to divest, the overarching picture appears to show that events in Gaza have done little to dent economic ties between the EU and Israel. For example, the SOMO report shows that the EU increased exports to Israel by €1bn between 2023 and 2024.