The Israeli government's response to last week's unprecedented joint statement by Canada, France and the U.K. could hardly be clearer, says former Canadian ambassador to Israel Jon Allen, now a senior fellow at the University of Toronto's Munk School.

"It's basically telling the world that we don't really care about what you think at this point in time," he told CBC News. "They really are thumbing their noses at the international community."

Settlement expansion has accelerated ever since the arrival of the current government, Netanyahu's sixth, at the end of 2022. But Allen says the announcement of 22 new settlements — both through new construction and the formalization of existing settler outposts built outside the law — is a major escalation in a number of ways.

"First of all, it's big in terms of the numbers. Secondly, it is legalizing what were deemed illegal settlements even in Israel by its Supreme Court," he said.

"But more importantly, you're getting statements out of ministers which are basically saying the purpose of this is to prevent a two-state solution, while at the same time you've got activity in Gaza, which looks like Israel may be trying to occupy large parts of the Gaza Strip as well."

The dramatic action, he said, is driven by a sense within the Israeli right that this is a now-or-never moment.

"These ministers realize that their polling numbers are very bad and this is their last chance to try and significantly change things on the ground in Israel," he said.

"And so they're really trying a last-ditch effort to kill the two-state solution."

From jail cell to cabinet table

While Prime Minister Benjamin Netanyahu has given his full endorsement to the settlement plan, many Israelis believe that the strongest impetus for it comes from the country's finance minister, Bezalel Smotrich, who also holds key posts giving him control over the West Bank.

Smotrich's role illustrates just how much mainstream politics in Israel has changed in the past two decades.

In 2005, Smotrich was one of four radical settlers arrested by Israel's Shin Bet security service on suspicion of plotting violent attacks to prevent the evacuation of Israeli settlements in Gaza and the northern West Bank. He appeared in security court in handcuffs and a prison jumpsuit.

Today, he is the number-two figure in the government and in a position to order the official re-establishment of settlements whose evacuation he once so radically opposed.

Smotrich on May 19 boasted that "we are disassembling Gaza, and leaving it as piles of rubble with total destruction [that has] no precedent globally. And the world isn't stopping us."

He said his own preference would be to cut off water as well as food, but that might lead other countries to intervene. He openly stated that the goal was to leave no Palestinians in Gaza.

On May 25, he returned to the same theme.

"We are being blessed with the opportunity, thank God, of seeing an expansion of the borders of the land of Israel, on all fronts," he said. "We are being blessed with the opportunity to blot out the seed of Amalek, a process which is intensifying."

'Loss of credibility' if Canada fails to act

"We oppose any attempt to expand settlements in the West Bank," wrote Prime Minister Mark Carney, Britain's Keir Starmer and France's Emmanuel Macron in their joint statement last week.

"Israel must halt settlements, which are illegal, and undermine the viability of a Palestinian state and the security of both Israelis and Palestinians. We will not hesitate to take further action, including targeted sanctions."

Thomas Juneau, a former Canadian defence official who now teaches about the Middle East at the University of Ottawa's graduate school of public and international affairs, told CBC News that Israel's announcement leaves Canada with little choice but to back up its words.

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"It does put pressure on the Canadian government, but also on the French, British, German and other European governments in the sense that there was a clear position that was taken last week of threatening actions against Israel," Juneau said.

"So if Canada and European players now do not do anything about 22 new settlements in the West Bank, there is a loss of credibility that would follow."

Former ambassador Allen said Canada can't lay down a marker like the joint statement it signed onto last week, and then let such a provocative response pass without taking action.

"I frankly don't think they will ignore this. I think those three governments were serious about what they were saying, and I expect sanctions to follow," he told CBC News.

Sanctions should target ministers: Former ambassador

Canada has already sanctioned a handful of extremist settlers, albeit reluctantly and only following actions taken by European allies.

But Western sanctions have had little practical effect on individual settlers, who have sometimes treated them as a badge of honour.

Although condemned many times by Western governments, the most extreme ministers in Netanyahu's cabinet have thus far avoided sanctions. Britain's David Cameron told the BBC last year that he had been preparing sanctions for Smotrich and Itamar Ben Gvir prior to his government's election defeat. Ben Gvir is a rabble-rousing extremist who was also once a target for Shin Bet surveillance, but is now Israel's minister of national security. 

Allen says there would be little point in simply repeating ineffectual sanctions on individual settlers, when the settlement policy is clearly being driven from the top.

"I thought that [the joint statement] was the strongest, most comprehensive announcement that I've ever seen out of the Canadian government. But if they were not to follow up, having issued a specific threat vis-a-vis settlements, then I think it would be a paper statement."

Allen identified Smotrich, Ben Gvir and Defence Minister Israel Katz as the three cabinet members driving the most radical policies.

"If I were advising them, I would advise them to sanction the ministers in question, all three of them," he told CBC News. "But we have to recognize that Prime Minister Netanyahu is the prime minister and he is allowing all of this to happen," he said.

Netanyahu counting on Trump

Juneau says that Netanyahu, at times like these, tends to rely on Israel's relationship with Washington. The Trump administration is the only major government in the world that does not always regard Israel's West Bank settlements as inherently illegal under the Fourth Geneva Convention, which forbids a victorious party in war from transferring its own population into conquered territory, or forcing the civilian population that lives there to leave.

"As much as there is a growing trend of European powers and Canada being irritated with Israel, that only matters at most in a secondary way in the calculus of the current Israeli government," Juneau said.

U.S. President Donald Trump, who suggested expelling Gaza's population to turn the territory into a kind of international tourist riviera, is unlikely to react strongly to the settlement announcement, said Juneau. "But there are a lot of indications that the Trump administration is growing somewhat irritated with Israel."

Signs include the fact that both Trump and Vice-President JD Vance have visited the Middle East without stopping in Israel, that Trump has clearly ignored Israeli wishes and objections in negotiations with both Iran and the Houthis of Yemen and persistent rumours that Trump is secretly negotiating some kind of grand bargain with Saudi Arabia without Israeli input.

"All of that put together is causing anxiety in Israel," said Juneau.

Canada will likely co-ordinate with allies

Canada will likely want to co-ordinate its response with the British and French governments that co-signed last week's joint statement, say the two experts.

"Where Canada can have a limited but real impact is when it acts with its allies, especially in Europe, but others, too: Australia, Japan, South Korea and a few others," said Juneau. 

"If there is a co-ordinated campaign, not only of sticks towards Israel, but also support to the Palestinian Authority and to the peace camp in Israel, then there can be an impact."

This week, European countries that didn't sign the joint statement separately warned Israel that their patience was at an end.

Italy's foreign minister said Israel's war in Gaza had taken on "absolutely dramatic and unacceptable forms" and "must stop immediately." Germany's conservative chancellor Friedrich Merz, long an unconditional supporter of Israel, said that "what the Israeli army is doing in the Gaza Strip, I no longer understand the goal, to harm the civilian population in such a way."

For the first time, Germany threatened "consequences" if Israel did not change direction, and Foreign Minister Johann Wadephul said Germany's days of "obligatory solidarity" with Israel were over.

Juneau says that Canada has no choice but to demand respect for the two-state formula, and for international law.

"If peace remains the objective, if security remains the objective, then there is no other alternative than coexistence between the Palestinian side and the Israeli side," he said.

"I think everybody involved on the European side, on the Canadian government side, understands perfectly well how far peace is. But it remains the only acceptable option."