Vatican, Israel to sign economic agreement

Jerusalem: The Vatican is about to "indirectly recognise" Israel's annexation of East Jerusalem, seen by many Palestinians as the future capital of their independent state, a media report on Monday said.

The lack of a preamble containing such a distinction is at the center of heightened tension between Palestinian Christian denominations and the Palestine Liberation Organisation (PLO) and the Vatican, it said.

Palestinian sources told the Israeli daily that the agreement would mean "indirect recognition" of Israeli annexation of East Jerusalem and of the imposition of Israeli law in part of the West Bank.

Over the past few months, NGOs and members of various Christian denominations in Israel have begun to receive details about the draft agreement, which has been presented to them as a lapse and a failure by the Vatican, the daily said.

Members of the Christian community in Jerusalem and the West Bank have held a number of emergency meetings recently and have contacted the Vatican to make clear that the agreement under discussion is not merely a fiscal and a technical agreement, and that a lack of distinction between occupied territory and Israeli territory could have severe implications, Ha'aretz said.

The response has only increased the concerns of local Christians denominations over what they see as erosion of the Church's position.

A number of Palestinian Christians have complained that the Church and the spiritual authority of the Vatican should have taken into consideration the special situation of Christians under Israeli occupation, and it has not done so, the report said.

As a state the Vatican is obligated to international law, and it did not take this into account in formulating the accord with Israel, they said.

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