UN Secretary General Ban Ki-moon said Sunday Israel's plans to build 3,000 new homes in East Jerusalem and West Bank settlements "would represent an almost fatal blow to remaining chances of securing a two-state solution."

Ban said in a statement that in the interest of peace, any plans for construction in the "E-1" corridor must be rescinded.

He called on all parties to resume negotiations and intensify efforts towards a comprehensive, just and lasting peace. He also urged the parties to refrain from provocative actions.

Israel plans to build some 3,000 new housing units in East Jerusalem and West Bank settlements in response to the Palestinians' successful bid for recognition at the UN General Assembly this week, a senior diplomatic source told Haaretz on Friday.

Europe has been putting heavy diplomatic pressure on Israel to reverse its decision to proceed with development plans for a new neighborhood in the area between Ma’aleh Adumim and Jerusalem, known as the E1 corridor. Since Friday, five senior European ambassadors have communicated strong words of protest to the Foreign Ministry in Jerusalem, all bearing the same main message: the European Union’s demand that Israel reverse its decision.