Jerusalem's Latin Patriarch criticised Israel on Wednesday for insisting Palestinians recognise it as a Jewish state and said God made the Holy Land for Muslims and Christians too.

Michel Sabbah, the Holy Land's Roman Catholic leader, said in his annual Christmas message that the Israeli-Palestinian conflict had unleashed "forces of evil" across the Middle East and it was up to Israel to make a relaunched peace process work.

"I hope we are entering into a new phase with Annapolis," Sabbah told a news conference in Jerusalem's Old City. "The one who will decide is Israel. If Israel decides for peace, there will be peace."

Israeli Prime Minister Ehud Olmert and Palestinian President Mahmoud Abbas launched the first peace talks in seven years at a conference in Annapolis, Maryland, last month. They are trying to reach a deal on Palestinian statehood by the end of 2008.

Sabbah said he was concerned about Israeli demands, rebuffed by the Palestinians, that Israel be recognised as a Jewish state because that would discriminate against Muslims and Christians.

"God made this land for all three of us, so a suitable state is one who can adapt itself to the vocation of this land," said Sabbah, who was born in Nazareth, a town where Christians believe Jesus was raised and which is now part of Israel.

"If it's Jewish, it's not Muslim or Christian."

The Holy Land -- particularly the Old City of Jerusalem -- is sacred to Jews, Muslims and Christians. Palestinians say defining Israel as Jewish is unfair for the millions of Arabs, both Muslim and Christian, who live there.

Israel, which is majority Jewish, argues other countries call themselves Islamic republics.

Sabbah expressed hope for peace in the Holy Land and urged Palestinians and Israel to shun violence, whether "carried out by the state or by extremists".

He said Israel, as "the strong party", bore most responsibility for forging a peace deal.

"Until now, there has been no peace, simply because there has been no willingness to make it," he said.