The 193-nation U.N. General Assembly overwhelmingly approved a resolution to upgrade the Palestinian Authority's observer status at the United Nations from "entity" to "non-member state," the same status as the Vatican.

"The Holy See welcomes with favour the decision of the General Assembly by which Palestine has become a Non-member Observer State of the United Nations," a statement said.

But it also said it was a "propitious occasion" to recall a "common position" on Jerusalem expressed by the Vatican and the Palestine Liberation Organisation when the two sides signed a basic agreement on their bilateral relations in 2000.

Thursday's statement called for "an internationally guaranteed special statute" for Jerusalem, aimed at "safeguarding the freedom of religion and of conscience, the identity and sacred character of Jerusalem as a Holy City, [and] respect for, and freedom of, access to its holy places."

The Vatican's re-stating of its position on Jerusalem, which has remained mostly dormant for years, was bound to irk Israel, which says there is no need for an international status for Jerusalem because those guarantees already exist.

Israel declared Jerusalem its "united and eternal" capital in 1980 after annexing East Jerusalem in the Six Day War in 1967. World powers have not recognised the annexation.

Palestinians want East Jerusalem to be the capital of an eventual state.

Israel has always resisted the concept of any form of international mandate over Jerusalem.

It has been some time since the Vatican re-stated its position on the city so forcefully, and Thursday's statement was bound to be received negatively by Israel, a diplomat with direct knowledge of their relations said.

Israel has always maintained that it already guarantees the city's special nature as sacred to the three great monotheistic religions — Christianity, Judaism, and Islam.

Thursday's statement called on both sides to seek an "effective commitment to building peace and stability, in justice and in the respect for legitimate aspirations, both of the Israelis and of the Palestinians."

The Vatican and Israel established full diplomatic relations in 1994. Both Pope John Paul II and Pope Benedict visited the Jewish state and Palestinian territories.