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President of France Emmanuel Macron has criticised the move by U.S. President Donald Trump to officially recognise Jerusalem as the capital of Israel and move its embassy from Tel Aviv to the controversial city, saying that the move does not help in restoring peace to the region and also violates international law.

"France remains convinced that the only solution in accordance to international law is to enable the establishment of two states living side by side in peace - and this can only happen through negotiations," he said on Sunday.

"I invite the prime minister to make courageous gestures regarding the Palestinians and to overcome the current deadlock."

The move by Trump which saw the US officially recognise Jerusalem as the capital of Israel was widely condemned by world leaders  including French President Macron.

Commenting on Trump's decision, Macron expressed his deep disapproval because "it contradicts international law".

He also called on Israel to "freeze settlement building" as a gesture of peace.

But Netanyahu said that Trump's recognition merely recognised realities on the ground, adding that Palestinians must accept Jerusalem as Israel's capital.

Netanyahu once again said Jerusalem has always been the capital of the state of Israel.

"The sooner the Palestinians come to grips with this reality, the sooner we'll move towards peace," he said at the press conference.

"This is why I think President Trump's announcement was so historic and so important for peace," he added, saying that there is a "serious effort underway" by the US administration "on the quest for peace".