A copy of a report written by EU heads of mission in Jerusalem and Ramallah condemns recent Israeli settlement building and recommends that EU member states place economic sanctions on settlements, AFP reported on Wdnesday.

The report referred to Israel's settlement construction in east Jerusalem as "systematic, deliberate and provocative" and stated that Jewish settlement construction was "the biggest single threat to the two state solution." 

The report singled out as problematic Israeli development in the Jerusalem neighborhoods of Har Homa, Gilo, and Givat Hamatos, as well as Israeli settlement plans in the area known as E1. According to the report, settlement in E1 results in cutting the West Bank in half and in the "forcible transfer of 2,300 Bedouin."

The report suggests prevention of financial transactions with and foreign direct investments to settlements and further suggests that EU states should "ensure that imports of settlement products do not benefit from preferential tariffs."

Last November, the government gave a green light to zoning and planning of thousands of housing units in the area known as E1 which lies between Jerusalem and Ma’aleh Adumim. Israel's announcement to develop E1 was seen as a response to the UN approving the Palestinian bid for non-member observer state status.

Then, EU foreign policy chief Catherine Ashton slammed Israel’s announcement regarding E1 and additional construction in the settlements, saying she was “extremely worried by the prospects of settlement expansion on such a scale.”

“The reaction of the international community to any such decision is likely also to be influenced by the extent to which such expansion may represent a strategic step undermining the prospects of a contiguous and viable Palestine with Jerusalem as the shared capital of both it and Israel.”

Herb Keinon contributed to this report.

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