Berlin has called for a unified European response to the "E1 project," which some officials warn poses an "existential threat" to the future of the two-state solution. Israel disputes this and maintains that the status of settlements is a matter of negotiations.
Israel's new West Bank settlement initiative is a "big mistake," German Chancellor Friedrich Merz said on Tuesday.
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At a press conference with Czech Prime Minister Andrej Babiš in Berlin, Merz described the developments as "annexation moves" and called on Israel to halt the settlement push.
Merz added that advancing the project would "complicate the two-state solution," and urged the Israeli government to reconsider its decisions.
The so-called "E1 project" was authorised last August, paving the way for 3,400 housing units across a 12-square-kilometre area to the east of Jerusalem, in West Bank territory.
Merz has also called for a joint European message on the matter.
Israeli Finance Minister Bezalel Smotrich, who oversees settlement policy, defended the project last year. "The Palestinian state is being erased from the table, not with slogans but with actions. Every settlement, every neighbourhood, every housing unit is another nail in the coffin of this dangerous idea," Smotrich said in mid-2025.
Urgent calls for restraint
Meanwhile, during his unannounced visit to Israel due to security concerns, German Foreign Minister Johann Wadephul reiterated Merz's stance and criticised the Israeli government's policies regarding the West Bank.
"It is the German government's request that the Israeli government thoroughly reconsider these plans," the CDU politician said.
"A situation must not arise where the possibility of a future for the Palestinians in their own statehood is ruled out," he said during his meeting with his Israeli counterpart Gideon Sa'ar in Jerusalem.
Wadephul also issued a sharp condemnation of the "violence perpetrated by radical settlers," following reports from Palestinian authorities that three people were killed in attacks over the weekend.
"The Israeli rule of law must counter this with the utmost determination," he concluded.
In response to earlier criticism of settlement expansion, Sa'ar stated in December that "foreign governments will not restrict the right of Jews to live in the Land of Israel, and any such call is morally wrong and discriminatory against Jews."
"The cabinet decision to establish new settlements is intended, among other things, to help address the security threats Israel is facing," Sa'ar added.
Under international law, Israeli settlements in the West Bank are considered illegal.
Israel disputes this and maintains that the status of settlements should be determined through negotiations rather than unilateral declarations.
Approximately 500,000 Israelis currently live in the area alongside 3 million Palestinians, as land acquisition for settlers has become significantly easier under the current administration, according to recent media reports.
The project is part of a broader surge in Israeli expansion, which reached its highest level since 2017 following the approval of 19 new settlements in December 2025.
Smotrich announced in August that authorities had greenlit the settlements "to block the establishment of a Palestinian terror state" and that the recognition of a Palestinian state "will receive an answer from us on the ground."