Why would the settlements halt harm Israel and its ability to negotiate?. To let the settlements continue and kill the peace talks would be a disaster for everyone. Since the official Israeli borders are still at 67 lines the league of nations that is US and EU should do everything possible the get the Israel to stick with the halt until the new borders are established and approved.
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Livni: Shaked's annexation bill would lead to bi-national state with Palestinian majority in Knesset
from the article: Top Likud minister: Obama knows settlements are part of Jewish homeland