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Israel approves new settlement construction in sign of anger over Palestinian government

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JERUSALEM - Israel gave the final go-ahead Thursday to build nearly 1,500 homes in Jewish settlements, saying the construction was a response to the formation of the Palestinian unity government backed by the Islamic militant group Hamas.

The move triggered international criticism and deepened a rift between Israel and its Western allies. With Israel outraged at the world's embrace of the unity government, Israel's housing minister said the new construction was "just the beginning."

Israel has been sparring with its allies in Washington and Europe since Western-backed Palestinian President Mahmoud Abbas swore in the unity government Monday.

Israel has asked the world to shun the new government because it is backed by Hamas, which has killed hundreds of Israelis in suicide bombings and other attacks in the past two decades. The European Union and the United States, along with Israel, consider Hamas a terrorist group.

Abbas says Hamas plays no formal role in the government. His new Cabinet consists of technocrats who have accepted international demands to renounce violence and accept Israel's right to exist. None of the men have any affiliation with Hamas.

Israeli officials say any government that is backed by Hamas is unacceptable as long as the group remains sworn to Israel's destruction. But for now, both the U.S. and EU have said they will give the new government a chance — and will continue funneling hundreds of millions of dollars in aid to Abbas.

Earlier this week, Prime Minister Benjamin Netanyahu said he was "deeply troubled" by the U.S. stance, putting him at odds with his closest and most important ally.

The international community considers Israeli settlement construction illegal or illegitimate, and continued construction was a recurring sticking point in the latest round of U.S.-backed peace talks. The sides made little progress in nine months of talks that collapse in April.

Netanyahu's housing minister, Uri Ariel, said Thursday that tenders had been issued to build about 900 homes in the West Bank and about 560 more in east Jerusalem, territories captured in the 1967 Mideast war and which the Palestinians seek as parts of a future state.

In a statement, Ariel said the construction was a "fitting Zionist response to the formation of a Palestinian terror government.

He said the plans were "just the beginning," and an Israeli official said an additional 1,800 housing units were expected to be approved next week. The official, speaking on condition of anonymity because he was not authorized to talk to the media, said the units were at various stages of the planning process, but about 700 were slated to receive final approvals for construction.

Another Israeli official, also speaking on the same condition of anonymity, said Netanyahu had authorized Ariel's decision. He claimed all construction would take place in areas that Israel expects to keep in any "conceivable" peace deal.

But the outside world does not make such a distinction, and any new settlement activity promises to escalate tensions with the Palestinians and the international community.

More than 560,000 Israelis live in territories captured in the 1967 war, and the Palestinians say that continued growth of settlements on the lands they claim makes it increasingly difficult for them to achieve independence.

Chief Palestinian peace negotiator Saeb Erekat said Thursday's settlement announcement is "a clear sign that Israel is moving toward a major escalation." He said the Palestinians were formulating a response to the move.

Israel pressed forward with construction plans for thousands of settlement homes during the peace talks, drawing Palestinian accusations that Israel was negotiating in bad faith. Israel said it never committed to halting construction during the talks.

Thursday's move was the first settlement activity to be announced since the talks collapsed. U.S. Ambassador to Israel Dan Shapiro told Army Radio that the U.S. opposes the planned settlement construction. State Department deputy spokeswoman Marie Harf called the new housing "unhelpful" and "illegitimate."

The EU said in a statement it was "deeply disappointed" by the housing approvals, saying they were "unhelpful to peace efforts." The EU urged Israel to reverse the decision.

U.N. Secretary-General Ban Ki-moon was "deeply concerned" by the reports of new settlement construction, his spokesman said in a statement, which urged Israel to heed international calls to "freeze settlement activity."

Justice Minister Tzipi Livni, who was Israel's chief peace negotiator, told Army Radio the announcement was a "political mistake ... that will only distance us from the ability to recruit the world against Hamas."

The collapse of peace talks helped push Abbas to reconcile with his Hamas rivals after a seven-year rift.

Hamas seized the Gaza Strip from Abbas' forces in 2007, leaving the Palestinians with two rival governments, the Hamas regime in Gaza and Abbas' Palestinian Authority in autonomous areas of the West Bank.

After concluding he could not reach a peace agreement with Netanyahu, Abbas decided the time was ripe to repair ties with Hamas. The rift is considered a major impediment to establishing a Palestinian state in the West Bank and Gaza, with east Jerusalem as its capital. Hamas, facing a financial crisis caused by an Egyptian and Israeli border blockade, also was eager for a deal.

Despite their reconciliation deal, the new Palestinian government faces many challenges. Among them are blending two large bureaucracies staffed by tens of thousands of civil servants, as well as figuring out what to do with Hamas' militia in Gaza. Hamas has thousands of armed fighters trained to battle Israel, and the group remains in firm control over Gaza.

Police in Gaza shut down banks in the coastal territory Thursday after Hamas-affiliated public servants and security officers rioted at ATMs the previous night because they did not receive their salaries, while loyalists of Abbas' Fatah movement were paid.

___

Associated Press writers Lara Jakes in Washington, Cara Anna at the United Nations0 and Juergen Baetz in Brussels contributed to this report.

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