LISBON, Sept 14 (Reuters) – Portugal’s foreign minister said on Monday that Israeli settlement expansion and ​economic pressure in the occupied West ‌Bank and East Jerusalem were undermining prospects for a viable Palestinian state.

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Foreign Minister Paulo Rangel ​said Israel’s E1 settlement plan was “extremely ​pernicious” because it would divide the West ⁠Bank, isolate East Jerusalem and was ​incompatible with a two-state solution.

Israel’s withholding of ​Palestinian tax revenues amounted to a “brutal strangulation” of the Palestinian Authority’s finances, preventing the economy from functioning, ​he said after meeting Palestinian Foreign ​Minister Varsen Aghabekian Shahin in Lisbon.

Rangel also cited ‌the ⁠closure of Christian schools in East Jerusalem as evidence of worsening conditions there.

Portugal recognised the State of Palestine a year ago.

Rangel ​said the ​two-state ⁠solution was the only way to guarantee peaceful coexistence between Israelis ​and Palestinians.

Israel said last week ​it ⁠was closing Britain’s consulate in East Jerusalem in response to plans by the UK, France ⁠and ​Canada to block imports from ​Israeli settlements in the West Bank.

Reporting by Sergio Goncalves; ​editing by Charlie Devereux and Ros Russell

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