U.N. Secretary-General Ban Ki-moon called on Israel and the Palestinians on Saturday to restart negotiations as world powers stepped up diplomatic efforts to push the peace process forward.
Ban also called on the Jewish state to stop settlement building in the occupied West Bank
and East Jerusalem, and said the holy city should be the capital for both Israel and a future Palestinian state.
"We have to get negotiations under way," Ban said after meeting Western-backed Palestinian Prime Minister Salam Fayyad in the West Bank city of Ramallah. "We can and must find a way for Jerusalem to emerge from negotiations as the capital of two states with arrangements for holy sites acceptable to all."
Israeli Prime Minister Benjamin Netanyahu declared a limited, 10-month freeze on settlement building in the West Bank in November. But the moratorium did not include territory it captured in a 1967 war and annexed to Jerusalem.
The Jewish state sees all of Jerusalem as its capital, a claim that has not won international recognition.
The United Nations, along with the United States, Russia and the European Union, make up a quartet of Middle East mediators.
Ban arrived in Ramallah a day after the Quartet met in Moscow and called for Israel to halt all settlement construction and for a peace deal with the Palestinians by 2012.
"The Quartet has sent a clear and strong message: we are strongly supporting your efforts to establish an independent and viable Palestinian state," he told Fayyad ahead of formal talks.
The Quartet also urged Israel and the Palestinians to resume talks on final status issues, security, borders of a future Palestinian state, the fate of Palestinian refugees and the status of Jerusalem, to find a settlement within 24 months.
Such a deal would end "the occupation which began in 1967 and result in the emergence of an independent, democratic and viable Palestinian state living side by side in peace and security with Israel," Ban said.
Israeli Foreign Minister Avigdor Lieberman was particularly irked by the two-year deadline.
"Peace cannot be imposed artificially and with an unrealistic calendar," he was quoted as saying in an address to the Jewish community in Brussels.
"This type of statement only harms the possibilities of reaching an accord."
Before those talks, Fayyad had taken Ban to a vantage point above Ramallah to show him a large swathe of West Bank territory under exclusive Israeli control and off limits to Palestinian development.
Ban "will see for himself how difficult it is," Fayyad said before the U.N. secretary general arrived, "but he will also see how determined we are to create positive facts on the ground."
Fayyad claims 60 percent of the West Bank consists of land in so-called Area C, under exclusive Israeli control, and that 70,000 Palestinians live in such zones.
Following the tour, Ban said: "I have seen for myself plainly and clearly how Palestinians are living under such restriction and limitation. Even in your territory your are not able to develop or even maintain a normal economic life."