JERUSALEM, March 31: The Jerusalem authorities on Monday announced plans to build 600 new homes at an Israeli settlement in the occupied West Bank which they consider to be part of the Holy City.

The municipality made the announcement as US Secretary of State Condoleezza Rice wrapped up a tour of the region aimed at bolstering the slow-moving peace process and amid Palestinian anger at continued settlement activity.

“The plan is part of a global initiative by the mayor of Jerusalem to build 40,000 housing units in the city to ease access to housing for young couples,” a municipality statement said.

It said 600 homes will be built in Pisgat Zeev, a Jewish settlement in occupied and annexed Arab east Jerusalem.

The Palestinians want to make the eastern part of the Holy City the capital of their future promised state.

The international community views all Israeli settlements on occupied Palestinian land as illegal, and the issue is one of the main stumbling blocks in peace talks revived in November at Annapolis in the United States.

“The construction of the settlements is a major challenge to the Arab world, the entire world, especially to those who took part in the Annapolis conference,” Palestinian information minister Riyad al-Malki said in response to Jerusalem’s announcement.

“It is a very distressing and dangerous issue for us,” he told a news conference in the West Bank city of Ramallah.

Monday’s announcement coincided with the publication of a report by the Peace Now activist group saying that some 500 buildings that will provide thousands of new homes are being built in Jewish settlements in the West Bank.

The United States and Europe have pressed Israel to halt settlement activity, but on March 26 Prime Minister Ehud Olmert said construction would continue at settlements in the West Bank and east Jerusalem.

An internationally drafted Middle East peace blueprint, revived at the Annapolis conference, calls on Israel to freeze settlement construction.

“Not a single project was frozen,” Peace Now said.

“Since the Annapolis summit, there was a leap in the number of tenders and construction plans in east Jerusalem,” the group said.—AFP