- Associated Press - Thursday, August 11, 2011

JERUSALEM (AP) — Israel‘s interior minister gave final authorization to build 1,600 apartments in disputed east Jerusalem and will approve 2,700 more within days, officials said Thursday, detailing a plan that could complicate diplomatic efforts to dissuade Palestinians from declaring statehood at the United Nations.

The announcement drew immediate criticism from the Palestinians and from Israel‘s leading anti-settlement group, which accused the government of seizing on mass protests over housing costs to give economic justification to the always explosive issue of building in the holy city.

Prime Minister Benjamin Netanyahu’s office knew the construction plans were moving ahead, Interior Ministry spokesman Roi Lachmanovich said. An earlier approval for the 1,600-apartment project embarrassed Mr. Netanyahu and caused a diplomatic rift with the United States because it coincided with a visit to Israel by U.S. Vice President Joseph R. Biden Jr.

Palestinians oppose all Israeli construction in east Jerusalem because it chips away at their hopes of establishing the capital of a future state in the holy city.

The approval for the new apartments also could create new problems for Washington, which is trying to persuade the Palestinians to abandon their statehood bid and enter into negotiations with Israel instead.

Senior Palestinian official Saeb Erekat accused Israel of favoring settlements over peace.

“We call upon the U.S. administration to support our endeavor at the U.N. because the only way to preserve the two-state solution now is the admittance of the state of Palestine,” he said.

Mr. Lachmanovich, the ministry spokesman, said the new apartments were necessary to address a housing shortage in the city.

“There’s always something pending,” he said when asked about the timing of the approvals.

Actual construction likely will not begin for years because building plans will have to go through multiple approval processes.

The Peace Now anti-settlement group accused the government of “cynically” exploiting a sweeping grass-roots uprising sparked by high housing prices to cement its plans to build new apartments in Jerusalem’s contested eastern sector.

The decision was also unlikely to win much favor with Israel‘s closest ally, the United States, which opposes the Palestinians’ statehood bid and, like Israel, says negotiations on Jerusalem and other core issues are the only way forward.

Jerusalem’s fate “needs to be negotiated between the two parties,” said U.S. Embassy spokesman Kurt Hoyer. “Unilateral actions on either side that appear to prejudice the outcome of those negotiations we find counterproductive.”

On Tuesday, Washington rebuked Israel for advancing separate plans to build 930 apartments in another neighborhood of east Jerusalem.

The Palestinians refuse to negotiate with the Netanyahu government as long as it continues to build in the West Bank and east Jerusalem — territories that would form the core of their future independent state.

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