Rice criticises settlements but sees progress in ME talks

In Arab east Jerusalem, occupied and annexed by Israel following the 1967 Six Day War, the number of tenders has increased by a factor of 38, the group said, from 46 units in 2007 to 1,761 in 2008.

Abbas said after his meeting with Rice in the West Bank city of Ramallah that he had again raised the issue of settlements, “which still continue and which without a doubt are the main obstacle in the political process.”

But he also insisted the two sides were making progress, saying “just because we have not yet succeeded does not mean we have failed.”

Olmert’s spokesman Mark Regev stressed that the Israeli premier “will continue efforts to reach a historic agreement by the end of the Bush administration.” Livni for her part played down the impact of the settlement activity.

“I would like to suggest to my partners not to use it as an excuse and I know they are not using it as an excuse but I understand their frustration sometimes,” she said.