Former Paraguayan President Horacio Cartes meets with Israeli Prime Minister Benjamin Netanyahu in Jerusalem, July 19, 2016. Photo: Kobi Gideon / GPO.

Israel has closed its embassy in Paraguay following the South American country’s decision to move its embassy in the Jewish state from Jerusalem back to Tel Aviv.

The step by Paraguay — announced by its foreign minister on Wednesday — marked a reversal of a previous decision made in May by former President Horacio Cartes to follow the US and Guatemala in establishing embassies in Israel’s contested capital city.

“Paraguay wants to contribute to an intensification of regional diplomatic efforts to achieve a broad, fair and lasting peace in the Middle East,” Foreign Minister Luis Alberto Castiglioni told reporters on Wednesday.

Cartes had traveled to Jerusalem to inaugurate the new embassy in May. His successor, Mario Abdo, also a member of the conservative Colorado Party, took office last month.

The Israeli Foreign Ministry stated on Wednesday, “Israel views with great severity the unusual decision of Paraguay, which will cloud bilateral relations.”

The Palestinian Authority said its foreign minister, Riyad al-Maliki, met Abdo two weeks ago, and hailed Paraguay’s change of mind as “a new Palestinian diplomatic achievement.”

“Minister Maliki exerted a big effort during his meeting with the new president who instructed his foreign minister to arrange the issue,” the PA Foreign Ministry said in a statement.