by Hisham Abdallah
RAMALLAH, West Bank, Aug 22 (AFP) - A tacit agreement by the United States to allow Israel to expand its West Bank settlements will destroy the Middle East peace process, senior Palestinian officials said Sunday.
"The Palestinian Authority strongly criticises the American position regarding the expansion of Israeli settlements," Palestinian leader Yasser Arafat's top advisor, Nabil Abu Rudeina, told AFP.
"The American position is harmful to the peace process and the roadmap and ... encourages the Israeli government to accelerate its aggressions and its war against the Palestinian people."
The US-backed roadmap peace plan requires Israel to freeze all construction in the West Bank and Gaza Strip, including natural growth.
But a US diplomatic source confirmed Sunday a report in the New York Times that Washington had now adopted "a covert policy decision toward accepting natural growth".
US officials declined last week to condemn Israeli Prime Minister Ariel Sharon's decision to approve the construction of 1,000 new homes in four of the largest exisiting West Bank settlements, a move widely interpreted as a bid to placate opponents of his plan to pull settlers out of the Gaza Strip.
"It looks like the official policy is now catching up with the reality," the diplomatic source said, adding that it should not be interpreted as carte blanche to expand the settlements.
Palestinian negotiations minister Saeb Erakat declined to criticise the US government but said that settlement activity in direct contravention of the terms of the roadmap would only serve to wreck the chances of a peace deal.
"The Americian administration has to commit Israel to stop all settlement activity, including natural growth," Erakat told AFP.
"That is what the roadmap calls for but apparently Israel never committed itself to that and continued increasing settlements.
"The American administration has to explain this commitment to the Israeli government and ask them to commit themsleves to it, because it will only contribute to destroying any possible political settlement."
The roadmap aims for the creation of a Palestinian state by 2005 but has made next to no progress since its endorsement by both sides last year.
While the Palestinians say that Israel is failing to meet its commitments by allowing settlements to expand, Israel accuses the Palestinian leadership of failing to crack down on militant groups behind anti-Israeli attacks.
Sharon's Gaza pullout suffered a humiliating defeat at the hands of his right-wing Likud party last week when members voted for a motion against the main opposition Labour party joining a new coalition government -- a move seen as vital for the project to win parliamentary approval.
Bush has enthusiastically endorsed the so-called disengagement plan, and is anxious to help Sharon in his standoff with Likud hardliners.
Israeli officials have declined to comment on the New York Times report.