The European Union accuses Israel of actively pursuing the annexation of East Jerusalem Al-Quds, undermining hopes for peace with Palestinians.
Diplomats in Brussels say an EU meeting on Monday is to likely to discuss the stalled Middle East peace process, which is continuously being obstructed by Israel.
East Jerusalem Al-Quds has been seen for years as the prospective capital of a future Palestinian state. This is one of the most sensitive issues in the Middle East peace talks, which have been suspended for almost a year.
The annual report drafted by the EU heads of missions in Jerusalem Al-Quds has condemned Israel’s policy of expanding illegal settlements and demolishing Palestinian homes and eviction orders in 2009.
As a result, over 600 Palestinian-owned structures have been demolished since the year 2000, it said.
This Israeli policy, by practical means, is weakening the Palestinian community in the West Bank, "impeding Palestinian urban developments and ultimately separating East Jerusalem Al-Quds from the rest of the West Bank," the report said.
Israel occupied and annexed East Jerusalem Al-Quds in 1967 and considers it its "eternal indivisible capital" in a move never recognized by the international community.
The EU report also said that Israel’s policies in East Jerusalem Al-Quds "are undermining prospects for a Palestinian capital in East Jerusalem Al-Quds and incrementally render a sustainable two-state solution unfeasible."
The 14-page report said that Israel’s policy in East Jerusalem Al-Quds is "an integral part of a broader Israeli strategy."