The United Nations issued a report Monday saying the security fence Israel is building will effectively separate mainly Arab-populated East Jerusalem from the West Bank.

"This will restrict access to workplaces, health, education [services] and to places of worship", the report said.

The Defense Ministry, in charge of the project, made no immediate comment on the report.

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The report by the UN Office for the Coordination of Humanitarian Affairs (OCHA) said Israel has completed more than half of a planned 720 km fence started in 2003.

In 2004, the World Court ruled construction of the fence was illegal. Israel has ignored the ruling, the report said.

Another fence under construction around a settlement bloc near the West Bank town of Bethlehem will isolate a Palestinian cultural area there and "sever Bethlehem from Jerusalem," the nine-page document said.

Israel captured East Jerusalem in the 1967 Six Day War. Palestinians want to make East Jerusalem the capital of a state they aspire to establish in the West Bank and Gaza Strip.

Meanwhile, Dutch foreign minister Maxime Verhagen recently warned a construction company from the Rotterdam area to terminate its involvement in work on the separation fence in the West Bank.

"I expect Riwal to stop providing cranes for the wall. I hope this will be the last we hear of it," Verhagen said in a media statement late last month, adding that "the government will keep a close watch" on the company's actions.

The UN report said other sections of the fence would effectively trap some 50,000 of the 2.5 million Palestinians living in the West Bank in a zone between the territory and Israel.

"These Palestinians would be unable to access critical services such as schools, clinics and shops in either Israel or the West Bank without special permits," the report said.

It said Israel had tightened procedures to obtain such "visitor" permits, so far granted to only 40 percent of the Palestinian farmers who need them to cultivate land they own on the Israeli side of the fence.

"Israel has opened gates in the fence to facilitate some movement, but half were open for a shorter time than scheduled, and subsequently 10 towns in the northern West Bank lacked round-the-clock access to emergency services," the report said.

About 80 percent of Israel's fence is to be built on West Bank land, while the remaining 20 percent will lie in Israel, according to the report.