David Friedman, the US ambassador to Israel, speaks at the Israeli-Palestinian International Economic Forum in Jerusalem, Feb. 21, 2019. Photo: Reuters / Ronen Zvulun.

The U.S. ambassador to Israel on Thursday urged deeper business ties between Israeli settlers and Palestinian businessmen in the West Bank, angering Palestinian leaders.

David Friedman, who was appointed by US President Donald Trump, was speaking in Jerusalem at a forum to encourage business links between Israeli settlements and Palestinians.

“There are many, many Palestinians that would like to be freed up to engage in business ventures with Israelis, and they’re entitled to that opportunity,” Friedman told Reuters at the two-day forum attended by Israeli government officials, international businessmen and a handful of Palestinians.

Friedman’s remarks were immediately attacked by Palestinian officials as encouraging settlement activity in the West Bank, an area Israel took control of from Jordan in the 1967 Six-Day War and which the Palestinians seek as part of a future state.

“This constitutes a stab in the back of the Palestinian people,” said Wasel Abu Youssef, a member of the Palestine Liberation Organization’s executive committee.

“We warn against any involvement or participation of any Palestinian in projects with settlers, or meetings called by the American ambassador.”

Most of the world considers the settlements illegal under international law, a position Israel rejects. US criticism of Israeli settlement building has died down since Trump took office.

Many Palestinians view engagement with the settlements as “normalization,” arguing that doing business with Israelis in the West Bank legitimizes their presence and hinders future Palestinian sovereignty.

However, thousands of Palestinians work in settlements, often in manufacturing or construction jobs which they say offer higher wages than similar jobs in Palestinian cities.

Haldun al-Husseini, a Palestinian garment manufacturer from Jerusalem who attended the forum, says business with Israelis is key to improving the Palestinian economy, where unemployment stands at 32 percent.

“Most of my business comes from Israelis,” Husseini said. “If we don’t work together, we will not improve Palestinian lives.”