(VOVworld) – US Secretary of State John Kerry said Wednesday that Israel’s settlement building in the West Bank threatens both the hope for peace with the Palestinians and Israel's own future as a democracy.

US Secretary of State John Kerry delivers a speech on Middle East peace at The US Department of State on December 28, 2016. (Photo: Zach Gibson/Getty/AFP)

Kerry insisted that a two-state solution is the only way to end the long-festering conflict between Israel and Palestine. But negotiations have been deadlocked since 2014 and the parties involved refuse to make any concessions.

Kerry said both Israel and Palestine need to accept a two-state solution and their border must be based on the areas held by the two sides before the 1967 Middle East War, with Jerusalem as a divided capital.

Kerry said that declining to use its veto in the UN against the first UN resolution to condemn Israel for its settlement policy was aimed at saving the two-state solution.

Following Kerry’s statement, Israeli Prime Minister Benjamin Netanyahu called the US abstention an act against Israel, saying Kerry didn’t mention that the real reason for the instability in the Middle East is the opposition by Palestinians to a Jewish state.