* Kerry's remarks "intolerable", Netanyahu confidant says
* Boycott warnings have touched a nerve in Israel
* Kerry trying to reach framework Israeli-Palestinian deal
(Adds State Department comments, paragraphs 8-9)
By Jeffrey Heller
JERUSALEM, Feb 2 U.S. Secretary of State John
Kerry is holding a gun to Israel's head in peace talks with the
Palestinians by warning it could face international isolation if
negotiations failed, a senior Israeli cabinet minister said on
The remarks by Strategic Affairs Minister Yuval Steinitz,
who is close to Prime Minister Benjamin Netanyahu, followed
recent accusations by Israel's defence minister that Kerry was
being "messianic" in his pursuit of a peace deal.
At a Munich security forum on Saturday, Kerry touched a
nerve in Israel by pointing to "an increasing de-legitimisation"
campaign building up against it internationally and "talk of
boycotts" if the Israeli-Palestinian conflict did not end.
"Are we all going to be better with all of that?" asked
Kerry, who is seeking a framework deal soon that will set a path
toward a final accord on peace and Palestinian statehood.
Steinitz seized on the top U.S. diplomat's remarks as a
threat against Israel that would only encourage the Palestinians
to harden their positions in the six-month-old negotiations,
which have shown few signs of progress.
"The things ... Kerry said are hurtful, they are unfair and
they are intolerable," Steinitz told reporters.
"Israel cannot be expected to negotiate with a gun to its
head when we are discussing the matters which are most critical
to our national interests."
State Department spokeswoman Jen Psaki, in an emailed
statement, said Kerry remained staunchly opposed to any boycott
of Israel and was simply describing "previously stated facts
about what is at stake for both sides" if peacemaking failed.
"Secretary Kerry has always expected opposition and
difficult moments in the process, but he also expects all
parties to accurately portray his record and statements," she
Netanyahu, in public remarks at the weekly meeting of his
cabinet, was more guarded than Steinitz - making no direct
mention of Kerry.
But, calling any attempts to impose a boycott "immoral and
unjustified", Netanyahu said: "No pressure will cause me to
forfeit the State of Israel's vital interests, chiefly the
security of its citizens."
Netanyahu is facing pressure from another direction -
ultranationalists within his coalition government - to oppose
any evacuation of Jewish settlements from Israeli-occupied land
Palestinians seek for a future state.
Most countries view those enclaves as illegal, a position
Moderate members of Netanyahu's government have warned of
catastrophe if the right-wing leader walks away from the table.
Israeli chief peace negotiator Tzipi Livni has described the
negotiations as "the wall stopping a wave" of economic boycotts.
And she has cautioned that Israel could face the sort of
isolation imposed on South Africa during years of apartheid.
Companies in Israel's largest economic partner, the European
Union, have already started to signal their concern.
A large Dutch pension fund, PGGM, said last month it is was
divesting from five Israeli banks because of their business
dealings with settlements in the West Bank and East Jerusalem,
territory Israel captured in the 1967 Middle East war.
The issue has also grabbed headlines over a
multi-million-dollar sponsorship deal between actress Scarlett
Johansson and SodaStream, an Israeli firm operating in the West
She announced on Thursday she had quit as a global
ambassador for Oxfam, which had called Johansson's association
with SodaStream incompatible with her role for the charity.
(Additional reporting by Stephen Brown and Dan Williams,
Editing by Rosalind Russell)