Vice President Biden: Israeli Settlement Announcement 'Undermined' Trust as Peace Talks Resume

ABC News’ Karen Travers and Simon McGregor-Wood report:

Vice President Joe Biden once again condemned Israel's plans for new settlements in the occupied territory of East Jerusalem and said that the move threatens to damage the fragile trust between the two sides at this critical juncture.

“The decision by the Israeli government to advance planning for new housing units in east Jerusalem undermined that very trust, the trust that we need right now in order to begin as well as produce -- have profitable negotiations,” Biden said today in Ramallah.

Biden met with Palestinian Authority President Mahmoud Abbas just one day after the Israeli Interior Ministry announced plans to build 1,600 new settlement homes in the disputed area of east Jerusalem.

Biden’s visit was meant to tout the rejuvenated Middle East peace talks but the announcement by the Israelis has overshadowed the highest -level to Israel by an Obama Administration official.

Israeli officials including Prime Minister Netanyahu were quick to apologize for the embarrassment caused. The announcement was characterized as a procedural step in a long running planning process rather than an intentional provocation.

Israelis did not include East Jerusalem in their 10 month moratorium on settlement expansion. Netanyahu's right wing coalition claims it has every right to build homes for Jewish residents in areas the Palestinians consider to be their own. It was Israeli settlement expansion in East Jerusalem that made the Palestinians so reluctant to re-start peace talks.

Yesterday Biden said he was pleased that the Israelis and Palestinians agreed to resume indirect peace talks after a 14-month lapse but urged all sides to “build an atmosphere to support negotiations, not complicate them.”

Today he sent a signal that the Obama Administration would not tolerate aggressive actions by either side that threaten to disrupt the peace talks.

“As we move forward, the United States will hold both sides accountable for any statements or actions that inflame tensions or prejudice the outcome of talks, as this decision did,” Biden said with Abbas.

Abbas asked the Israeli government “not to waste this opportunity to make peace.”

“I call upon this government to stop its settlement policies and to stop imposing fights on the ground and to give the efforts of President Obama’s administration and Representative Mitchell’s efforts the opportunity to succeed,” Abbas said.

-Karen Travers and Simon McGregor-Wood

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