The Israeli government protested to France on Thursday after Orange had said it intended to end a brand licensing agreement with Partner, Israel's second largest mobile operator. The French company's statement came just hours after its CEO Stephane Richard was accused of giving in to a pro-Palestinian campaign.

Richard was quoted by media reports as saying at a news conference in the Egyptian capital Cairo that he was willing to withdraw the Orange brand from Israel "tomorrow morning," but moving too quickly would expose his company to legal risks and possible financial penalties.

"I know that it is a sensitive issue here in Egypt, but not only in Egypt ... We want to be one of the trustful partners of all Arab countries," he was quoted as saying.

His remarks touched a raw nerve in Israel which is growing increasingly concerned about global boycott efforts and the impact on its image abroad.

Criticism

After Orange's announcement, Israel's Prime Minister Benjamin Netanyahu said: "I call on the French government to publicly renounce the miserable remarks and the miserable action of a company that is under its partial ownership."

"I call on our friends to unconditionally declare - in a loud and clear voice - that they oppose any kind of boycott of the state of the Jews," he added.

But Orange insisted its decision was not politically motivated. Citing its own "brand development strategy," the company said it did not wish to maintain a brand presence in countries "in which is it not an operator," while distancing itself from the politics.

Israel has said the Boycott, Divestment and Sanctions (BDS) movement, sponsored by pro-Palestinian groups, is motivated by anti-Semitism and a desire to paint Israel as illegitimate. The movement accuses Israel of denying basic human rights to Palestinians.

France's Foreign Ministry declined to comment specifically on Richard's comments. However, it reaffirmed that Paris was against any boycott of Israel, while viewing as illegal the settlements it has built in occupied territory, where Partner and other Israeli phone companies also operate.

sri/uhe (AFP, Reuters)