The United States and Israel have signed a landmark agreement to establish a permanent American embassy compound in Jerusalem, formalising a diplomatic commitment that has been in place only temporarily since Donald Trump's first term in office. Under the deal, announced on Wednesday, the US will lease land at the Allenby compound in southern Jerusalem for just $1, with the facility set to consolidate diplomatic services currently spread across several locations in the city.
US Ambassador to Israel Mike Huckabee, an evangelical pastor who represents a strand of American conservatism deeply committed to the US-Israel alliance, struck a strongly religious tone at the signing ceremony held at Israel's foreign ministry. "The United States not only recognises Jerusalem as the eternal, indigenous, and forever capital of the Jewish people, but also that the United States says that we're going to do something about it," he said, adding: "I would say God made that decision 3,800 years ago." Israeli Foreign Minister Gideon Saar welcomed the agreement as proof of an "unbreakable alliance," calling Trump's original 2017 decision to move the embassy from Tel Aviv a moment that "set the record straight."
The move carries deep historical and legal weight. Jerusalem has been one of the most fiercely contested cities in the Israeli-Palestinian conflict for decades. After Israel captured East Jerusalem during the 1967 Arab-Israeli war, it declared the entire city its undivided capital — a claim not widely recognised under international law. The original 1947 UN partition plan envisioned an internationally administered status for the city. Palestinians seek East Jerusalem as the capital of a future state, and the vast majority of countries still maintain their embassies in Tel Aviv, holding that Jerusalem's final status must be resolved through negotiations.
The choice of site has drawn sharp criticism. Israeli human rights organisation Adalah has condemned the project, arguing the Allenby compound sits on land confiscated from Palestinians under a 1950 Israeli law that allowed the state to seize property belonging to displaced persons and refugees. Adalah said it has already filed legal challenges on behalf of heirs of Palestinian landowners, some of whom hold Jordanian or American citizenship, and accused Washington of "directly supporting illegal Israeli mechanisms of displacement and land seizure."
The announcement comes against a complex regional backdrop. The US and Israel recently concluded a joint military campaign against Iran, and indirect US-Iran negotiations in Doha are ongoing, aimed at building on a mid-June framework agreement. The embassy deal is seen as a signal of Washington's continued support for Israel at a sensitive diplomatic moment — and, for Palestinians and much of the international community, a further blow to the prospect of a viable two-state solution with East Jerusalem as its capital.