Israeli Prime Minister Benjamin Netanyahu said Sunday that a deal to establish full diplomatic ties with the United Arab Emirates proves that Israel doesn’t need to retreat from occupied land sought by the Palestinians in order to achieve peace and normalization with Arab states.

Israel and the UAE announced Thursday they were establishing full diplomatic relations in a U.S.-brokered deal that required Israel to halt its contentious plan to annex occupied West Bank land sought by the Palestinians. Netanyahu has insisted the annexation plans are only on “temporary hold” at the request of the United States.

The UAE, like most of the Arab world, long rejected official diplomatic ties with Israel, saying recognition should only come in return for concessions in peace talks. Its accord with Israel breaks that long-held tenet and could usher in agreements with other Arab states, undermining an Arab consensus that was a rare source of leverage for the Palestinians.

“According to the Palestinians, and to many others in the world who agreed with them, peace can’t be reached without conceding to the Palestinians’ demands, including uprooting settlements, dividing Jerusalem and withdrawal to 1967 lines,” Netanyahu said in a video statement. “No more. This concept of ‘peace through withdrawal and weakness’ has passed from the world.”

The Palestinians want the West Bank, east Jerusalem and the Gaza Strip for their hoped-for state, and peacemaking with them since the 1990s has been based on withdrawal from those lands to make way for a Palestinian homeland. Israel captured the territories in the 1967 Mideast war, although it withdrew its troops and settlers from Gaza in 2005.

But what has been a wall of Arab support for the Palestinians and their demands has begun to crack in recent years, in large part because of the shared enmity of Israel and other Arab states toward Iran and Iranian proxies in the region.

The Palestinians bristled at Netanyahu’s remarks.

“Peace should be established on the basis of the Palestinian state with east Jerusalem as its capital. This is the Arab and international consensus and anything else has no value,” said Nabil Abu Rdeneh, a spokesman for Palestinian President Mahmoud Abbas.

Netanyahu also reiterated Sunday his interpretation of the UAE deal: that annexation was only being suspended and that it was still on the table, so long as it was done in coordination with Washington. UAE officials have indicated that the deal means annexation has been shelved entirely.

After President Donald Trump released his Mideast plan earlier this year, which was favorable to Israel, Netanyahu said he would forge ahead with annexing parts of the West Bank. Netanyahu backed away from moving forward with annexation last month in the face of fierce international opposition and misgivings by White House officials.

But Netanyahu, who has seen his popularity plummet over his handling of the coronavirus crisis, has faced searing criticism from settler leaders and their representatives in parliament over the annexation backtrack, and he has tried to reassure them that he remains committed to the move.