Brussels, Aug 16 (IANS): The European Union (EU) has welcomed Israel's decision to suspend its plan to annex parts of occupied Palestinian territory, calling it a positive step, the bloc's Council said in a statement.

"Any unilateral decision that undermines a lasting, agreed solution should be avoided," Xinhua news agency quoted the statement as saying on Saturday.

The council also welcomed the normalization of relations between Israel and the United Arab Emirates (UAE), saying such a move will benefit both countries, and is "a fundamental step for the stabilization" of the region.

The EU remains firm in its commitment to a negotiated and viable two-state solution and reaffirms its readiness to work towards the resumption of meaningful negotiations between Israelis and Palestinians, said the statement.

The decision is part of a historic agreement that took place on August 13 via a phone call between US President Donald Trump, Israel Prime Minister Benjamin Netanyahu and Sheikh Mohammed Bin Zayed, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE.

As part of the agreement, Israel will suspend declaring sovereignty over areas outlined in Trump's vision of peace and focus its efforts now on expanding its ties with other countries in the Arab and Muslim world.

The UAE and Israel will also immediately expand and accelerate cooperation regarding the treatment of and the development of a vaccine for coronavirus.

According to reports, this is the first peace treaty between Israel and an Arab country in 25 years.

But, Palestine has slammed the peace agreement, saying it was "disgraceful" and a "blow to the Arab Peace Initiative and the decisions of the Arab and Islamic summits, and an aggression against the Palestinian people".