JERUSALEM (CNN) -- Israeli Prime Minister Ehud Olmert said Sunday that his country's disagreement with Britain over expanding settlements in the West Bank "should not stand in the way" of a peace agreement with the Palestinians.
"You criticized our settlement policy and I tried to explain to you the restraints which we put on ourselves on the one hand and the need to keep the pace of life going on, on the other hand," Olmert told visiting British Prime Minister Gordon Brown at a joint news conference in Jerusalem.
"And while you disagree with us, at least I hope you understand better the position of Israel on some of these issues."
Earlier in the day, Brown said Israel's expansion of settlements in the Palestinian territory of the West Bank "has made peace harder to achieve."
"It erodes trust. It heightens Palestinian suffering. It makes the compromises Israel will need to make for peace more difficult," Brown said at a news conference with Palestinian President Mahmoud Abbas in the West Bank city of Bethlehem.
"So we are very clear, not just Britain but the whole of the European Union, what should be done. We are also clear that the violence must stop too.
Terrorism is a major obstacle to Palestinian statehood, and the efforts to ease movement and access restrictions which must continue," he said.
Britain is a member of the Mideast Quartet, which has been working to negotiate a peace deal between Israel and the Palestinian government along with the United States, the United Nations, and Russia.
Brown's visit to the region is his first as Britain's prime minister. He is scheduled to address the Israeli parliament, the Knesset, on Monday.
Olmert restated his position that an Israeli-Palestinian peace deal can be achieved by the end of the year, despite the disagreement over its settlement expansions.
"This should not stand in the way of achieving an agreement between us and the Palestinians," he said. "We are closer than ever, as I said in Paris last week, to an agreement.
"We have some disagreements which are very significant but I believe that we can overcome these disagreements within the time frame that has been set ... which is hopefully the end of this year."