(SOUNDBITE) (English) AUSTRALIAN PRIME MINISTER SCOTT MORRISON, SAYING: "Australia now recognizes West Jerusalem, is the capital of Israel." And with that - Australian Prime Minister Scott Morrison reversed decades of Middle East policy.
Announcing Saturday (December 15) that Australia will open trade and defense offices in West Jerusalem, and hopes to move its embassy out of Tel Aviv once the status is confirmed.
It's a move that risks inflaming tensions between Israel and Palestinians.
The status of the city remains one of the biggest obstacles to a peace agreement between the two sides.
This decision comes months after U.S. President Trump re-located the American embassy.
Something that infuriated Palestinians, upset the Arab world and Western allies, but delighted Israel.
They regard the whole city as their capital, including the eastern sector that it annexed in the 60s.
Morrison said on Saturday the move is necessary to break a quote rancid stalemate.
He also re-affirmed Australia's support for a two-state solution in the region, that would see the East recognized as the capital of a Palestinian state.