Israeli products, including those made in settlements, are commonplace in the West Bank, either for lack of a Palestinian-made alternative or because consumers prefer them to local goods. As a result, previous Palestinian efforts to stem consumption of Israeli-made goods have failed.
The confiscation of settlement products, which began in November, marked the most serious government effort to date to enforce a boycott. Palestinians consider Israel's continued settlement expansion as the biggest obstacle to eventual independence and say Israel's recent pledge to curtail construction is insufficient.
About 300,000 Israelis live in West Bank settlements and another 180,000 in east Jerusalem — land the Palestinians seek for their state.
Israeli Foreign Ministry spokesman Yigal Palmor said a boycott is counterproductive.
"I don't think by concentrating their efforts on boycotts they will achieve any of the political goals, if these still include reaching a peace agreement with Israel," Palmor said.
Palestinian Economics Minister Hassan Abu Libdeh said the boycott of settlement products is long overdue.
"Consuming settlements' products is wrong, nationally, economically, politically, and must stop right away," Abu Libdeh told a news conference at the Information Ministry in the West Bank city of Ramallah.
He said about $1 million worth of merchandise were seized in November, another $66,000 on Monday evening and that the campaign would continue. Targeted items include juice, canned goods and cosmetics.
A ban of goods made in Israel would violate interim peace accords, but the international community agrees with the Palestinians that Israel's West Bank settlements are illegal. Several European countries are also making efforts to boycott settlement products.
In the Gaza Strip, meanwhile, the territory's Hamas rulers further restricted the movement of its 1.4 million residents. Gaza has been virtually cut off from the world since a violent Hamas takeover in 2007, with border closures enforced by Israel and Egypt.
Hamas recently announced that even the few still able to travel — university students, top business people, patients with life-threatening illnesses — need to get permission from Hamas to leave the territory.
The ruling has further complicated the already obstacle-ridden travel of those seeking treatment in Israel.
At Gaza's Erez crossing into Israel, medical workers said that Hamas police on Tuesday held up an ambulance carrying a baby boy for about an hour, demanding that his parents first get a travel permit. The boy had swallowed a battery and was headed to Israel for urgent treatment.
Dozens more patients were returned to Gaza and told to apply for permission, in line with the new policy, the medical workers said.
Hamas government spokesman Hassan Abu Hashish said the new policy was meant to minimize "chaos." He did not elaborate.