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Prime Minister Ehud Olmert recently approved the construction of 48 new apartments in Ariel, deep inside the northern West Bank.

Last week, Olmert told foreign correspondents that Israel is not building in the territories outside the settlement blocs. Ariel has been considered a settlement bloc by all Israeli governments, but the United States refuses to recognize it as such.

Because of Washington's objections, Ariel Mayor Ron Nahman used to complain that former defense minister Amir Peretz consistently refused all his requests for permission to build new housing in the city. But Peretz's successor in the ministry, Ehud Barak, ended the freeze.

Barak's office said in a statement that the new construction was meant to allow evacuated Gaza settlers, who had relocated to Ariel with the government's consent, to move from temporary to permanent housing.

Last week, Haaretz reported that Barak also approved bringing five trailer homes to the settlement of Tene Omarim to house evacuated Gaza settlers. That settlement is located east of the separation fence, meaning that Israel almost certainly does not intend to keep it under any future agreement.