RAMALLAH (Ma'an) -- Israel's approval of 2,000 new settlement housing units on occupied Palestinian land and its withholding of Palestinian tax revenue are illegal and amount to blackmail, PLO official Saeb Erekat said Tuesday.

"Our condemnation is unequivocal. These steps are illegal and amount to blackmail that we categorically reject," Erekat said in a statement.

Israel decided on Tuesday to accelerate Jewish-only settlement building and withhold Palestinian Authority funds, a day after UNESCO awarded Palestine full membership of the UN cultural agency.

Nabil Abu Rudainah, the spokesman for President Mahmoud Abbas, described as "inhumane" the Israeli decision to temporarily withhold funds collected by Israel on behalf of the Palestinian Authority.

The Palestinian presidency also stated that Israel's approval of such measures proved they had decided "to speed up the destruction of the peace process."

Israeli Prime Minister Benjamin Netanyahu called for the accelerated construction of some 2,000 housing units, said an official statement released after he convened his cabinet.

Erekat urged the international community to act against Israel's violations of international law.

"This further proves that all along, Israel has been defying the will of the international community and illegally expansion settlements on occupied Palestinian land for political reasons," he added.

"The land on which these settlement units are to be built is occupied Palestinian land. The money that Israel is withholding is also Palestinian money. This theft is happening in broad daylight and the international community is bearing witness" Erekat said.

The PLO official said the measures would not affect Palestinians' drive for statehood.

"These reckless measures will not intimidate us nor will they change our course of action. We will continue to pursue the Palestinian people's natural and legal right to statehood and self-determination."

In the absence of peace talks, which collapsed about a year ago in a dispute over settlement building, President Mahmoud Abbas has been seeking statehood recognition from the United Nations.

Netanyahu has called to restart peace talks without preconditions, but Abbas says he will return to negotiations only after Israel totally freezes its settlement activity.

The Quartet of Middle East peace mediators -- which includes the United States, Russia, European Union and the United Nations -- has been trying to jumpstart the process and said last week both sides had agreed to offer proposals to solve two key sticking points, territory and security.

It will be the second time this year that Israel has withheld the revenues it collects on behalf of the Palestinian Authority. The revenues, which include duties on goods being imported to the West Bank, amount to around $100 million each month -- half of the PA's domestic revenue base.

Israel decided earlier this year to withhold the revenues when Abbas concluded a reconciliation agreement with Hamas.

The freeze imposed temporarily earlier this year resulted in the PA not being able to pay salaries to its 150,000 employees on time for the first time since 2007.

The move comes with less than a week to go before Palestinian Muslims mark Eid al-Adha, when families spend more than usual on festivities.