The European Union expressed disappointment on Friday at Israel’s decision to go ahead with the building of new homes in southern Jerusalem, AFP reported.

EU foreign policy chief Catherine Ashton was quoted by the news agency as saying she was “profoundly disappointed” by Thursday’s approval of a project to build 930 new homes in the Har Homa neighborhood in Jerusalem, adjacent to the Jerusalem neightborhood of Talpiot.

The plan, first approved by a local committee two years ago, was authorized by the Interior Ministry for marketing by the contractors who won development tenders, and for eventual construction.

The Ministry announced that at least 20% of the units to be built will be small, suitable for young families. The size and number of rooms were not announced, however.

“The European Union has repeatedly urged the government of Israel to immediately end all settlement activities in the West Bank, including in East Jerusalem,” Ashton’s statement read. “All settlement activities are illegal under international law.” The area is not in east Jerusalem, which seems to be a UN, EU and media blanket term for areas reunited to Jerusalem in the Six Day War.

AFP added that Ashton said Israel’s decision to build Jewish homes was particularly regrettable at a time when the international community was working to restore talks leading to a solution of the conflict between Israel and the Palestinian Authority.

“Continued settlement undermines trust between the parties and efforts to resume negotiations,” Ashton was quoted as saying. “This is especially true with regard to Jerusalem.

“I believe there can be no sustainable peace in the Middle East without a two-state solution with the state of Israel and a viable and contiguous Palestinian state living side by side in peace and security,” she added. “Settlement activity damages this prospect.”

But while Ashton claims that efforts are being made to resume peace talks, the Palestinian Authority said Thursday it would pursue its statehood bid at the United Nations despite Israeli Prime Minister Binyamin Netanyahu’s offer to use the pre-1967 lines as a basis for negotiations.

Senior PA official Saeb Erekat characterized Netanyahu’s concession as a publicity stunt intended to dissuade the PA from its unilateral statehood bid outside the framework of the Oslo Accords which stipulate negotiations and  no unilateral action.

"The Palestinian train is now heading towards New York," Erekat said during an Arab League committee meeting in Doha, Qatar late Wednesday.

“Members of the committee reached a final agreement to request the full support for a Palestinian state within the 1967 borders with its capital Jerusalem,” he said after the meeting.

(Arutz Sheva’s North American Desk is keeping you updated until the start of Shabbat in New York. The time posted automatically on all Arutz Sheva articles is, however, Israeli time.)