Prime Minister Benjamin Netanyahu accused the Palestinian leadership on Friday of wanting to ethnically cleanse the future Palestinian state of Jews.
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Netanyahu made the remarks in an English-language video message posted on his Facebook page.
Cricitizing the common argument that settlements in the West Bank are an obstacle to peace, the prime minister stated, "No one would seriously claim that the nearly two million Arabs living inside Israel — that they're an obstacle to peace."
Instead, the diversity of the Israel shows that it is ready for peace, while a Palestinian state with the precondition of no Jews amounts to ethnic cleansing, the prime minister said.
Netanyahu called the demand "outrageous" and expressed shock that this sentiment is accepted by the international community.
"Next time you hear someone say Jews can't live somewhere, let alone their ancestral homeland, take a moment to think of the implications," concluded the prime minister. "Our region needs more tolerance, not less," he added.
U.S. State Department spokeswoman Elizabeth Trudeau told reporters in Washington the administration is "engaging in direct conversations with the Israeli government" about the video.
"We obviously strongly disagree with the characterization that those who oppose settlement activity or view it as an obstacle to peace are somehow calling for ethnic cleansing of Jews from the West Bank. We believe that using that type of terminology is inappropriate and unhelpful," Trudeau said.
She said Israel expansion of settlements raises "real questions about Israel's long-term intentions in the West Bank."
Ahmed Majdalani, an adviser to Palestinian President Mahmoud Abbas, dismissed Netanyahu's remarks as "lies."
"These are silly claims," he said. "It's Netanyahu who conducts ethnic cleansing every day in Jerusalem and the Palestinian territories by announcing (new) settlement units... The settlements are an ongoing war."
On Thursday, the Russian foreign ministry reported that Netanyahu and Palestinian Authority President Mahmoud Abbas have agreed to hold a meeting in Moscow. However, the two sides have not yet agreed on a date.
A report published in June by the Middle East Quartet, which complises United States, Russia, the European Union and United Nations, cited settlements and their expansion as one of the obstacles to peace. Other obstacles noted in the report were violence and incitement and lack of the Palestinian Authority's control of the Gaza Strip.
The report called on Israel to change its policies in the West Bank, but reiterated that a peace accord could only be reached through bilateral talks.