Binyamin Netanyahu tonight endorsed the creation of a Palestinian state after weeks of pressure from Washington, but defied President Obama's demand for a halt to all settlements.
In a high-profile speech that the Palestinian administration of Mahmoud Abbas said "hobbles all efforts to save the peace process", the Israeli Prime Minister said that the Palestinians must recognise Israel as a "Jewish state" and that any future Palestinian state had to be demilitarised.
“If we have the guarantees on demilitarisation and if the Palestinians recognise Israel as the state of the Jewish people, then we arrive at a solution based on a demilitarised Palestinian state alongside Israel,” Mr Netanyahu said.
“The Palestinian territory will be without arms, will not control air space, will not be able to have arms enter, without the possibility of striking alliances with Iran or [Lebanese Shia militia] Hezbollah."
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