JERUSALEM, (Reuters) – A senior Palestinian figure  said yesterday that rising tension with Israel over settlement  building in the Jerusalem area was a “time bomb” that was eroding trust between the two sides.

Ahmed Qurei, a former prime minister and negotiator, joined  Tsipi Livni, a former Israeli foreign minister and now  opposition leader in parliament, in calling on both sides to  work harder to achieve a two-state solution.

“The Jerusalem situation, I think, is a time bomb if it  continues in this way,” Qurei told a forum of mostly Israeli  academics in Jerusalem, referring to the expansion of Jewish  settlements in East Jerusalem and plans to demolish Palestinian  homes to make way for more construction.  “It has an impact on the Palestinian people … and on trust  on both sides,” Qurei added.

Jerusalem is a core issue in the Israeli-Palestinian  conflict. Israel has annexed East Jerusalem as part of its  capital in a move not recognised internationally, and  Palestinians want the area as capital of a future state in the  West Bank and the Gaza Strip. The conflict has erupted lately into weekly protests by  Israelis and Palestinians, mostly in the predominantly  Palestinian areas of Silwan and Sheikh Jarrah, where Jewish  settlers have been moving in.

Israeli Prime Minister Benjamin Netanyahu, back from talks  in Washington with President Barack Obama, said he might discuss  Jerusalem but did not hint at any concessions.

“We have differences of views with the Palestinians. We want  a united city. They have their own views. We can — this is one  of the issues that will have to be negotiated,” Netanyahu said  on Fox News Sunday.