After the Nazis conquered Denmark during World War II and forced all Danish Jews to wear Star-of-David armbands to identify themselves, the wonderful Danish people responded by adopting the practice of wearing the same armbands themselves in solidarity.
If the current anti-Semitic European government decides to act like the Fourth Reich by decreeing that Israeli products must be labeled as such, why should we not expect many decent Europeans to respond in the Danish way by going out of their way to BUY Israeli products in solidarity with the unjustly treated Israelis?
I'm okay with labelling products for that reason. I personally sometimes make purchasing choices based on the origin of a product. Yes to Israel. No to anything supporting "marriage equality."
It becomes a real problem when a government can decide to ban imports from Israel (or "Bad Country Y"), though.