The Palestinians therefore agreed to settlement blocs, provided there would be a swap of equivalent land.

"This is in keeping with the government's aim of strengthening settlement blocs," he told the cabinet, according to a statement from his office.

The problem is with the second part of the proposal: to retain several large settlement blocs in the Palestinian West Bank.

The major Jewish settlement blocs in the West Bank would become part of Israel.

But in return, some 80 percent of the settlers will live in settlement blocs under Israeli sovereignty.

The five settlement blocs he listed would include a large proportion of the roughly 230,000 settlers who live in the West Bank.

"There will be building in the settlement blocs," he said, according to The Jerusalem Post.

We will hold on to the main settlement blocs.

"The settlement blocs will continue to exist," he said.

Much of the Strip (except for the settlement blocs and military areas) came under Palestinian control.