The U.S. government on Tuesday condemned Israel's plans to build 1,600 new homes in East Jerusalem settlements.
The news of the construction of new housing was known during the second day of the visit of U.S. vice president, Joe Biden, is making the Middle East.
Biden issued a statement which said the initiative announced by the government of Benjamin Netanyahu "is against the constructive discussions" that is keeping to promote peace between Israelis and Palestinians.
"The substance and timing of the announcement, particularly with the launch of proximity talks, is precisely the kind of step that undermines the confidence we need right now," he said.
"We must create an atmosphere that supports negotiations, not that simple," he said.
For its part, the Palestinian National Authority (PNA) reacted angrily to news of the construction of new Jewish homes.
ANP spokesman, Nabil Abu Rudeina, said "Israel's decision to destroy the proximity talks, announced on Monday by U.S. mediator George Mitchell.
"The decision to build in East Jerusalem means that U.S. efforts have failed even before the start of negotiations," said Rudeina, reported AFP.
Palestinians on Sunday agreed to pursue for a limited period of four months indirect discussions with Israel brokered by George Mitchell.
Occupied Territory
The status of Jerusalem, home to some 450,000 Jews and 230,000 Palestinians, is one of the crucial aspects of the conflict between Israelis and Palestinians.
Israel considers Jerusalem as its capital "eternal and indivisible" and the Palestinians claim the eastern sector of the Arab-majority city, as the capital of their future state.
The international community includes East Jerusalem, annexed by Israel in 1967 after the Six Day War, as an occupied territory, as housing is illegal.
Prior to that time the Israeli government's decision to allow the expansion of the settlement of Ramat Shlomo, Joe Biden had met with Israeli Prime Minister Benjamin Netanyahu.
Biden said after the meeting that a "real opportunity" for peace between Palestinians and Israelis.
The Vice President welcomed the fact that the two parties have agreed to conduct proximity talks and said his country will support those "who take risks for peace".
He said the proximity talks expected to lead to direct talks, through which one can "achieve a two state solution."
In a joint conference with Netanyahu, Biden also said Washington is absolutely committed to Israel's security and ready to prevent Iran from developing nuclear weapons.
Bad timing
As noted by the editor of the News Middle East Jeremy Bowen, Joe Biden's visit comes at a time of apprehension and pessimism about the possibilities that could provide further peace negotiations in the region.
"The fact that the indirect negotiations are presented as an achievement, is a sign of how bad things are," said Bowen.
The Palestinians refuse to hold direct peace talks with Israel until Tel Aviv to halt the building of settlements.
Nearly half a million Jews live in more than 100 settlements built on occupied West Bank and East Jerusalem.
Despite the end of last year, Israel announced its intention to freeze for 10 months to build settlements in the West Bank on Monday, coinciding with the arrival of Biden to the region, Israeli authorities gave the green light to the building of 112 new homes in the West Bank settlement of Beitar Illit.
Joe Biden will visit Ramallah on Wednesday for talks with PNA President Mahmoud Abbas, and also travel to Jordan for talks with King Abdullah.
Biden is the highest American authority who is visiting Israel and the Palestinian territories since Barack Obama became president in January 2009.
Additional info: At News Minute by Minute.

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