Israel plans to build hundreds of new settlements in Har Homa, a neighborhood in the section of Jerusalem claimed by the Palestinians.

The U.S. has said such construction is unhelpful to peace efforts, and the Palestinians say the project is undermining peace talks.

Olmert said Israel would continue building in those areas of Jerusalem, including Har Homa.

"Everyone knows that there is no chance that the State of Israel will give up a neighborhood like ... Har Homa," Olmert said in a joint news conference with visiting German Chancellor Angela Merkel.

The fate of Jerusalem is the most contentious issue in Israeli-Palestinian peace talks, which were relaunched last November after seven years of fighting. Israel occupied east Jerusalem in the 1967 Mideast war and annexed it to its capital.

The Palestinians accept east Jerusalem as the capital of a future independent state that would also include the West Bank and Gaza Strip, other areas captured by Israel in the 1967 war.

Under the U.S.-backed "road map" peace plan, Israel must stop construction in Jewish settlements.

Palestinian negotiator Saeb Erekat reiterated that Israel must halt all settlement construction, including in Jerusalem.

"If they really want the year 2008 to be a year of peace, then this cannot be achieved with the continuation of settlement activities," Erekat said.

He called for U.S. intervention. Washington has agreed to monitor Israeli and Palestinian compliance with the "road map" peace plan.

Merkel said she had raised the issue of settlement construction with Olmert and noted that halting settlement expansion is part of the road map.

Olmert also announced that peace talks would resume later Monday. The Palestinians had suspended the negotiations early this month to protest a bloody Israeli offensive in the Gaza Strip.


Agencies

Güncelleme Tarihi: 18 Mart 2008, 12:59