According to a leaked EU report obtained by the Guardian, Israelinfo-icon is developing archaeological and tourism sites to legitimize illegal settlements in the Palestinian neighborhoods of Beit-ul-Moqaddas.

The conclusions in the report, which is written annually by the EU Heads of Mission in Beit-ul-Moqaddas, paints a bleak picture of the situation and the conditions facing 37% of the city's residents who are Palestinians. It raises concerns over Israel's ongoing home demolitions and the displacement of the Beit-ul-Moqaddas's Palestinian residents, Middle Eastinfo-icon Monitor reported.

EU diplomats said that Israel, the occupying power, was using tourism projects "as a political tool to modify the historical narrative and to support, legitimize and expand settlements". The projects are said to include settler run excavation sites in the heart of majority-Arab districts, a proposed cable car project with stops on confiscated land and the designation of built-up urban areas as national parks.

The report said that Israeli settlers as well as government institutions were pushing a "narrative based on historic continuity of the Jewish presence in the area at the expense of other religions and cultures". EU officials cited the City of David project, which is a government-funded archaeological park in the Palestinian neighborhood of Silwan that provides tours in the ruins of ancient Beit-ul-Moqaddas.

Israel was accused of "promoting an exclusively Jewish narrative, while detaching the place from its Palestinian surroundings". The report raised concerns over the fate of the Worldinfo-icon Heritage site of Beit-ul-Moqaddas, by concluding that these projects were turning the ancient city "into a commercial theme park".

The EU considers Israel's occupation of East Beit-ul-Moqaddas and the construction of settlements as illegal. It fully backs the rights of Palestinians to a national home in Palestineinfo-icon with East Beit-ul-Moqaddas as its capital.