United Nations Secretary General Ban Ki-moon called on Israel Wednesday to halt settlement building in the West Bank and put a stop to all forms of violence and incitement, the UN News Center reported.

Speaking in Uruguay at the UN Latin American and Caribbean Meeting in support of Middle East peace Ban said it was a "crucial time" for the Israeli-Palestinian peace process.

Open gallery view United Nations Secretary General Ban Ki-Moon Credit: AP

Time is of the essence in realizing the two-State solution, " Ban said, "the occupation that started in 1967 is morally and politically unsustainable, and must end. The Palestinians have a legitimate right to the establishment of an independent and viable State of their own."

The target dates for reaching an Israeli-Palestinian agreement on permanent status issues and completing the Palestinian Authoritys two-year State-building program are fast-approaching. Yet, the Israeli-Palestinian negotiations remain at a worrying standstill. We must intensify efforts to break the deadlock, he added.

Negotiations between Israel and the Palestinians hit a standstill in September after Israel resumed building in the West Bank following a moratorium on settlement building.

The secretary general continued, saying actions that prejudge the outcome of the process must stop, referring to Israel's continued settlement building in the West Bank and East Jerusalem , demolition of Palestinian homes and other forms of violence and incitement.

Ban then commended the Palestinian Authority for its efforts, the UN News center report said, praising the PA's efforts to establish state institutions, enforce security in the West Bank and receive international funding and recognition of its statehood goals.

The UN chief chastised Israel, the report said, calling on the government to take the necessary steps to improve economic and security conditions for Palestinians by removing obstacles to freedom of movement, stopping military operations and enhancing the PA's scope of influence in the West Bank.

Ban also implored Israel to further ease its blockade in Gaza, the report said, which has been under Hamas control since 2007. Israel has refused to negotiate with Hamas, whose charter calls for Israel's destruction and is responsible for numerous attacks perpetrated against Israel and its civilians.

In recent weeks, Hamas and the more moderate West Bank-based Fatah have been engaging in preliminary talks, with the possibility of unification in the future. Israel has made it clear that in the event that Fatah and Hamas join forces, Israel will not be open to negotiations, and Fatah must choose its ally.

Ban reportedly condemned the recent escalation in rocket fire from Gaza to Israel, calling on both sides to prevent civilian casualties and act in conformity with international law, reiterating his strong condemnation of the recent bombing in Jerusalem, in which a 59-year-old British tourist was killed and over 30 wounded.

He stressed that "Israel has the right to live in peace and security within internationally recognized and secure borders." According to the report the secretary general then said that both Palestinians and Israelis are entitled to Jerusalem as its capital, with "arrangements for holy sites acceptable for all."

The UN chief also said there "must be a just and agreed solution to the prolonged plight of the Palestinian refugees," an issue that has been highly disputed in past peace negotiations.

The two-day meeting in Uruguay will discuss settlement expansion, Jerusalem and the recent recognition of Palestinian statehood by governments in the region, including Brazil, Argentina and Uruguay, the report said.