EU not ready for major upgrade with Israel

BRUSSELS (Reuters) - The European Union is unlikely to agree to any wide-ranging upgrade of relations with Israel at a meeting with Foreign Minister Tzipi Livni on Monday, EU diplomats said on Wednesday.

The Jewish state had sought a joint declaration at the Luxembourg talks on boosting ties and giving Israel, which prides itself on its high-tech economy, greater access to EU markets, agencies and spending programmes.

However, an EU diplomat said: "That is not going to happen. One reason is that there wasn't much appetite at this point among member states, given the uncertainty of the situation on the ground in Israel and its immediate neighbourhood.

"Also ... there simply wasn't enough time to agree among the 27 (EU countries)."

The Israelis sent a memorandum to the EU last year suggesting a range of possible upgrades in relations, including regular summits of EU and Israeli leaders, and meetings with EU sectoral ministers. These would be in addition to the single annual session at foreign minister level.

"We'd like to see a political signal favouring the upgrading of our relations," an Israeli official said.

Palestinian Prime Minister Salam Fayyad wrote to Brussels last month urging the EU not to upgrade ties with Israel, which he accused of "flagrant disregard" of Palestinian rights by continuing to build Jewish settlements.

Diplomats said Egypt had also lobbied the EU against boosting ties with the Jewish state at a time when there was scant progress in the Middle East peace process.

Another EU diplomat said the 27-nation union was trying to find the right balance.