TEL AVIV, September 14, 2009 (WAFA)- Israeli Prime Minister Benjamin Netanyahu said that there will not be a complete freeze on settlement building and that building in Jerusalem will proceed as usual, daily Haaretz said.

'The Palestinians expect a complete halt to building; it is now clear that this will not happen,' Netanyahu said, 'Jerusalem is not a settlement and the building [there] will continue as normal.'

While speaking to the Knesset Foreign Affairs and Army Committees, Netanyahu spoke about progress made in regards to the peace process as well as the U.S. demand to freeze building beyond the 1949 Armistice Line.

'We clarified to the U.S. that we would continue building around 2,500 units whose construction had already begun,” he added. “Two days ago, we authorized 450 additional units. I stated that we would consider reducing the extent of our building.'

Netanyahu spoke about balancing the desire to participate in the peace process and negotiations with the need to allow Jewish residents in the West Bank to live normal lives. 'The reduction in building will be for a limited time and there is not yet an agreement with the U.S. on the period of time.'