Israel voiced dismay Friday at the Vatican's first accord with Palestine and warned the move would harm efforts to renew peace talks.
The foreign ministry expressed its "regret regarding the Vatican decision to officially recognise the Palestinian Authority (PA) as a state, in the agreement signed today," spokesman Emmanuel Nahshon said in a statement.
"This hasty step damages the prospects for advancing a peace agreement, and harms the international effort to convince the PA to return to direct negotiations with Israel," he said.
The accord, a treaty covering the life and activity of the Church in Palestine, was the first since the Vatican recognised the Palestinian state in February 2013.
The treaty, which took 15 years of negotiations to complete, was agreed in principle last month and bitterly condemned by Israel as a setback for the peace process.
The Vatican's recognition of the state of Palestine followed a November 12 vote in favour of recognition by the UN General Assembly.
Vatican officials have described it as reflecting the Church's desire to see the conflict in the Holy Land resolved by a "two-state" solution.
The Vatican has had diplomatic relations with Israel since 1993 but has yet to conclude an accord on the Church's rights in Israel which has been under discussion since 1999.
"We also regret the one sided texts in the agreement which ignore the historic rights of the Jewish people in the Land of Israel and to the places holy to Judaism in Jerusalem," Nahshon said.
"Israel cannot accept the unilateral determinations in the agreement which do not take into account Israel's essential interests and the special historic status of the Jewish people in Jerusalem," he added.
"Israel will study the agreement in detail, and its implications for future cooperation between Israel and the Vatican."
*This story was edited by Ahram Online.