Settlements must stop

Israel should stop building settlements and the Palestinians should cease incitement to violence, the Middle East diplomatic quartet said in a much-awaited report yesterday aimed at reviving peace talks.

The report came as Israel yesterday announced a lockdown on the West Bank city of Hebron and a reduction in monthly tax payments to the Palestinian Authority, after a wave of deadly attacks.

The measures, including increasing Israel's military presence in the West Bank and described as "the most substantial" in two years, come after a surge in nine months of violence.

The United States, European Union, Russia and the United Nations -- which comprise the quartet -- said settlements, demolition of Palestinian homes and Israeli confiscation of land were "steadily eroding the viability of the two-state solution."

"Israel should cease the policy of settlement construction and expansion, designating land for exclusive Israeli use, and denying Palestinian development," said the report.

Israeli Prime Minister Benjamin Netanyahu said the report "perpetuates the myth that Israeli construction in the West Bank is an obstacle to peace", but welcomed the quartet stating the need for the PA to act "to cease incitement to violence and strengthen ongoing efforts to combat terrorism, including by clearly condemning all acts of terrorism."

Senior Palestinian official Saeb Erekat expressed his disappointment that the report criticised both sides.

Yesterday, two Palestinians and an Israeli were killed in a series of attacks and clashes in the West Bank. At least 214 Palestinians, 34 Israelis have been killed since the violence erupted last October.

"We really are concerned that if there aren't significant changes, it will risk entrenching the one-state reality, and that will not be to the benefit of either side," said a senior State Department official in Washington.

Since the beginning of the Oslo peace process in 1993, the settlement population has more than doubled, with a threefold increase in so-called Area C -- the most sought-after land in the West Bank, said the report.

"This raises legitimate questions about Israel's long-term intentions, which are compounded by the statements of some Israeli ministers that there should never be a Palestinian state," it added.

There are currently at least 570,000 settlers living in the West Bank and east Jerusalem, which the Palestinians hope to make the capital of their future state. The United Nations has said settlements are illegal.

Among the 10 recommendations outlined in the report, the quartet urged Israel to lift the blockade of Gaza and called for restoring Palestinian Authority control over the Hamas-ruled Gaza Strip.

EU foreign policy chief Federica Mogherini and UN Secretary-General Ban Ki-moon urged Israel and the Palestinians to follow the recommendations.

Israeli spokesman Lieutenant Colonel Peter Lerner said the army was imposing a closure on and around Hebron and deploying two additional battalions to the area.

As the security measures were announced, Netanyahu ordered that the amount of tax funds transferred monthly to the Palestinian Authority be cut by the equivalent of the fiscal support paid to militants' families.

Israel transfers around $127 million in customs duties levied on goods destined for Palestinian markets that transit through Israeli ports monthly.