PM rejects Arab risk to farm trade

Tony Abbott has escalated a diplomatic brawl with Arab countries that threatens billions of dollars worth of farm exports, standing by a "provocative" adoption of more pro-Israel language.

Speaking to The Weekend West in Washington yesterday, the Prime Minister rejected as "far-fetched" threats by Arab League nations to stop taking Australian exports over what he described as a "slight change in terminology".

But his comments immediately fuelled concerns in Arab diplomatic circles which described them as an "affront", "unsatisfactory" and "unacceptable".

Attorney-General George Brandis sparked controversy last week when he announced that the Federal Government would no longer use the word "occupied" in reference to East Jerusalem and would instead use "disputed".

In response, 20 ambassadors representing Islamic countries sought an emergency meeting with the Department of Foreign Affairs and Trade on Thursday to express their anger.

The Arab League, which includes major trading partners such as Iraq, Egypt and the UAE, is set to debate the issue in coming weeks, with member states expected to call for a suspension of imports of Australian farm produce.

Mr Abbott denied Australian farmers would pay a price for the Government's change in policy, saying "nothing's at risk".

He said "no serious" person would back out of a trade deal because of a "terminological change".

But the head of the General Delegation of Palestine to Australia Izzat Abdulhadi said Mr Abbott had failed to explain the "strange" decision to change the Government's policy.