JERUSALEM: The city council on Monday approved plans for construction of 16 new apartments by a Jewish settlement group in the Sheikh Jarrah district of Israeli-annexed east Jerusalem, a councillor said.

The move drew an angry response from the Palestinian Authority, for whom settlement construction is one of the bitterest elements of the conflict, and which scuppered the latest round of US-brokered direct peace talks.

Yosef Pepe Alalu, a city councillor with the dovish Meretz party, told AFP the municipality's building and planning committee approved two plans for the building of up to 16 housing units on two separate sites in Sheikh Jarrah.

"There were two plans filed, on both (sites) there are currently small houses" which are owned by Palestinians, he said. One is inhabited, while the other is empty.

"This approval is the first stage," he told AFP. The move still had to be rubber-stamped by an interior ministry committee. "It will be at least a year before we see anything."

A spokesman for the municipality said that the projects in question were "private and not municipal," and that permits were never issued on the basis of the applicant's "religion, colour or creed."