The United States vetoed a UN resolution Friday that would have condemned Israeli settlements as "illegal" and called for an immediate halt to all settlement building.
All 14 other Security Council members voted in favour of the resolution.
British Ambassador Mark Lyall Grant, speaking on behalf of his country, France and Germany, condemned Israeli settlements in the West Bank. "They are illegal under international law," he said.
Palestine will join the United Nations as a new member state by September 2011.
The Obama administration's veto is certain to anger Arab countries and Palestinian supporters around the world. An abstention would have angered the Israelis, the closest US ally in the region, as well as Democratic and Republican supporters of Israel in the American Congress.
Washington says it opposes settlements in principal, but claims that the UN Security Council is not the appropriate venue for resolving the decades-old Israeli-Palestinian conflict.
US ambassador to the United Nations Susan Rice told council members that the veto "should not be misunderstood to mean we support settlement activity.
"While we agree with our fellow council members and indeed with the wider world about the folly and illegitimacy of continued Israeli settlement activity, we think it unwise for this council to attempt to resolve the core issues that divide Israelis and Palestinians," she said.
Palestinians said the veto is counterproductive to the peace process, helps Israel maintain illegal buildings.
"The American veto does not serve the peace process and encourages Israel to continue settlements, and to escape the obligations of the peace process," said Nabil Abu Rdainah, a close aide to Palestinian President Mahmoud Abbas.
Pressure to drop resolution
Earlier, the Obama administration has exerted pressure on the Palestinian Authority to drop the UN resolution in exchange for other measures.
Abbas has refused Washington's request to withdraw a UN Security Council resolution demanding Israel to freeze settlement expansion on occupied Palestinian land.
The decision was made unanimously by the Palestine Liberation Organisation's executive and the central committee of Abbas's Fatah movement on Friday, at a meeting to discuss US President Barack Obama's appeal to Abbas by telephone a day earlier.
"The Palestinian leadership has decided to proceed to the UN Security Council, to pressure Israel to halt settlement activities. The decision was taken despite American pressure," said Wasel Abu Yousef, a PLO executive member.
Obama, who had said Israeli settlements in territories it captured in a 1967 war are illegal and unhelpful to the peace process, says the resolution could shatter hopes of reviving the stalled talks.
In a 50-minute phone call on Thursday, he asked Abbas to drop the resolution and settle for a non-binding statement condemning settlement expansion, Palestinian officials said.
'Goldstone 2'
"Caving in to American pressure and withdrawing the resolution will constitute Goldstone 2," said a Palestinian official, speaking on terms of anonymity before the meeting.
He was referring to the wave of protest in October 2009 accusing Abbas of caving in to US pressure by agreeing not to submit for adoption a UN report that accused Israel and Hamas of war crimes during the invasion of Gaza two years ago.
Abbas maintains he insisted on submitting the report. A second Palestinian official, speaking before the decision was formalised, said it would be "a political catastrophe if we withdraw this resolution".
"People would take to the streets and would topple the president," he said, noting the wave of protest in the Arab world that swept out the Egyptian and Tunisian presidents.
The Palestinians say continued building flouts the internationally-backed peace plan that will permit them to create a viable, contiguous state on the 1967 land, after a treaty with Israel to end its occupation and 62 years of conflict.
Israel says this is an excuse for avoiding peace talks and a precondition never demanded before during 17 years of negotiations, which has so far produced no agreement.
The diplomatic standoff is complicated by the effects of Middle East turmoil on the Arab League, whose members backed the resolution. Egypt, a dominant member, and Tunisia are preoccupied with their transitions from deposed autocracies, and protests are flaring in Libya, Yemen and Bahrain.
Washington is trying to revive peace talks stalled since September over Israel's refusal to extend a moratorium on settlement building and Abbas's refusal to negotiate further until the Israelis freeze the illegal buildings.
'Nothing to lose'
Obama initially pressured Israel to maintain the moratorium only to relent in the run-up to the 2010 US mid-term elections to avoid, some analysts said, alienating key voters.
Instead of the resolution, Obama told Abbas he would back a fact-finding visit by a delegation of the Security Council to the occupied territories.
One PLO official said the leadership was determined not to cave in "even if our decision leads to a diplomatic crisis with the Americans", adding: "Now we have nothing to lose."
Kristin Saloomey, Al Jazeera's correspondent in New York, said that the US has been doing everything it can to stop this vote from happening, including incentives and threats.
"Apparently Obama threatened [on the phone to Abbas] that there would be repercussions if this vote actually came to the floor of the UN Security Council," she said.
"Today secretary of state, Hilary Clinton, called president Abbas [to put on more pressure] but none of this is getting through to the Palestinians.
"Obama is facing intense domestic pressure not to support the vote. The US is in a tough position, they know that a veto is going to make them look very bad in the Arab world ... and also the rest of the world is really in support of this resolution.
"All of the Security Council members are on the record saying they are going to vote for this resolution including US allies".
Since 2000, 14 Security Council resolutions have been vetoed by one or more of the five permanent members -- Britain, China, France, Russia and the United States. Of those, 10 were US vetoes, nine of them related to the Israeli-Palestinian conflict.
Radwan: American veto blatant bias in favor of Israel
[ 19/02/2011 - 09:50 AM ]
GAZA, (PIC)-- Dr. Ismail Radwan, a Hamas leader, has charged that the US veto against a UN Security Council resolution condemning Israeli settlement activity in the occupied Palestinian land reflected absolute bias in favor of Israel.
He said in a statement on Friday night that the veto also constituted a slap in the face of the Fatah-controlled authority in the West Bank that had wagered on the US.
He underlined that there was no more excuse for de facto president Mahmoud Abbas to continue in the frivolous settlement process.
For his part, Fawzi Barhoum, a Hamas spokesman, described the American veto as "shameful", adding that it unmasked the American role that obstructs the international consensus on illegitimacy of Israeli settlement activity in the occupied lands.
He said in a press release on Saturday that the veto was an American reward for the Israeli occupation's crimes and violations against the Palestinian people.
"The US administration was never honest in its patronage of any settlement project or peace process," Barhoum said.
He urged Abbas and his authority to end all forms of negotiations with Israel and to solidify the internal Palestinian front in face of challenges.
The US on Friday vetoed a UNSC resolution to condemn Israeli settlement activity, which was approved by 14 members out of the 15-member council.
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