The Central Council of the Palestinian Liberation Organisation (PLO) on Monday recommended suspending the recognition of Israel.

The council, which convened in the West Bank city of Ramallah for two days, issued a final statement recommending the PLO and Palestinian President Mahmoud Abbas suspend the recognition of the state of Israel until Israel recognises the independent state of Palestine on 1967 borders and calls off the decisions to annex east Jerusalem.

Salim al-Za'noun, speaker of the Palestinian National Council, the legislative body of the PLO rejected US President Donald Trump's declaration of recognition of Jerusalem as the capital of Israel and the transfer of his country's embassy to the city, Xinhua reported.

"The immediate goal is the independent state of Palestine, which requires moving from the status of authority and self-rule to the status of the sovereignty of the state of Palestine with East Jerusalem as its capital on the 1967 borders," the statement read.

Trump announced the recognition of Jerusalem as the capital of Israel and the transfer of his country's embassy to it on December 6, sparking the anger of the Palestinians and Arabs as well as heated international reactions.

The Palestinians want to have the eastern part of Jerusalem as the capital of their future state, while Israel insists that a unified Jerusalem, including its eastern part which it occupied in 1967, is its eternal capital.

Jerusalem is one of the final status issues for Palestinian-Israeli negotiations which have been stalled since 2014 after nine months of US-sponsored talks without progress to resolve the decades-old conflict.

The Palestinian statement said the US decision "makes it lose its eligibility as a mediator and sponsor of the peace process, and will be a partner in this process only after the cancellation of President Trump's decision on Jerusalem."

The council stressed the "rejection of any proposals or ideas for transitional solutions or interim stages, including the so-called state with temporary borders and the refusal to recognise Israel as a Jewish state."

It also called for the formation of a unity government "to strengthen the political partnership and unity of the Palestinian political system."