US Secretary of State Mike Pompeo has visited an Israeli settlement in the occupied West Bank, becoming the first top US diplomat to do so.

The landmark visit came following his announcement of a new initiative to combat the international Palestinian-led boycott movement.

Mr Pompeo said the US would brand the boycott movement as “anti-Semitic” and cut off all funding for groups that participate in it.

Such a step could deny funding to Palestinian and international human rights groups.

Both the visit and the announcement were a parting gift to Israel from Donald Trump’s administration, which has broken with decades of US policy to endorse Israel’s claims to territory seized in war.

In a Twitter post, Pompeo confirmed his visit to the Psagot Winery, located in a settlement near Jerusalem. Reporters were not allowed to accompany him.

“Enjoyed lunch at the scenic Psagot Winery today,” he tweeted.

“Unfortunately, Psagot and other businesses have been targeted by pernicious EU labeling efforts that facilitate the boycott of Israeli companies. The U.S. stands with Israel and will not tolerate any form of delegitimization.”

The European Union opposes Israeli settlements and requires imports from the occupied territory to be labeled as such.

Mr Pompeo had earlier said he would pay a visit to the Golan Heights, which was seized by Israel in the 1967 war and later annexed in a move not recognised internationally.

He also spoke of the global anti-Israel Boycott, Divestment and Sanctions (BDS) campaign, saying the US would regard it as “anti-Semitic”.

“We will immediately take steps to identify organisations that engage in hateful BDS conduct and withdraw US government support for such groups,” he said.

He added that all nations should “recognise the BDS movement for the cancer that it is”.

BDS organisers cast their movement as a non-violent way of protesting Israel’s policies toward the Palestinians. The movement, modelled on South Africa’s anti-apartheid campaign, has had some limited success over the years but no impact on the Israeli economy.

Israel views BDS as an assault on its existence and has seized on statements by some supporters to accuse it of anti-Semitism. Organisers have denied these allegations.

In a statement, the BDS movement reiterated its rejection of “all forms of racism, including anti-Jewish racism”.

It accused the US and Israel of trying to silence advocacy for Palestinian rights.

“The BDS movement for Palestinian freedom, justice and equality stands with all those struggling for a more dignified, just and beautiful world,” it said.

“With our many partners, we shall resist these McCarthyite attempts to intimidate and bully Palestinian, Israeli and international human rights defenders into accepting Israeli apartheid and settler-colonialism as fate.”

Mr Pompeo did not provide additional details about the initiative and it was unclear which organisations would be at risk of losing funding.

Israelis have accused international groups like Human Rights Watch and Amnesty International of supporting BDS – allegations they deny.

Human Rights Watch, whose researcher was deported from Israel last year for past statements allegedly in support of BDS, does not call for boycotting Israel. However, it has urged companies to avoid doing business in West Bank settlements, saying it makes them complicit in human rights abuses.

Amnesty does not take a position on the boycott movement.

Eric Goldstein, acting Middle East and North Africa director at Human Rights Watch, said: “The Trump administration is undermining the common fight against the scourge of anti-Semitism by equating it with peaceful advocacy of boycotts.”

In 2017, Israel passed a law that bars entry to foreigners who have called for economic boycotts of Israel or its settlements.

The US House of Representatives passed a resolution opposing the boycott movement last year and several US states have also enacted anti-BDS laws.

The EU’s former foreign policy chief Federica Mogherini said she opposed BDS but backed the movement’s right to call for boycotts as freedom of speech.

Virtually all Palestinian organizations support the boycott movement but, under Mr Trump, the US has cut off nearly all forms of aid to the Palestinians.

President-elect Joe Biden has pledged to restore the aid as part of efforts to revive the peace process.

Mr Pompeo spoke at a press conference with Israeli prime minister Benjamin Netanyahu who said the Israel-US alliance had reached “unprecedented heights” under the Trump administration.

Mr Netanyahu thanked the administration for moving its embassy to contested Jerusalem, abandoning the US position that Israeli settlements are contrary to international law.

He also thanked the administration for recognising Israel’s annexation of the Golan Heights and taking a hard line stance against Iran.

Israel captured east Jerusalem and the West Bank in the 1967 war. The Palestinians want both territories to be part of their future state and view the settlements as a violation of international law and an obstacle to peace — a position endorsed by most of the international community.

Nabil Abu Rdeneh, spokesman for Palestinian president Mahmoud Abbas, condemned Pompeo’s visit to Psagot as a “flagrant challenge to international legitimacy decisions.”

He accused the outgoing U.S. administration of “active participation in the occupation of Palestinian lands.”

President Trump’s Mideast Plan, which overwhelmingly favoured Israel and was rejected by the Palestinians, would allow Israel to annex up to a third of the West Bank. This would include all of its settlements there, which are home to nearly 500,000 Israelis.

“For a long time, the State Department took the wrong view of settlements,” Mr Pompeo said.

However, he said it now recognises that “settlements can be done in a way that (is) lawful, appropriate and proper”.

Neither Mr Netanyahu nor Mr Pompeo said anything about the US election in the conference. Mr Pompeo, like President Trump, has yet to acknowledge a Democrat victory.

The Israeli prime minister congratulated Mr Biden and referred to him as the president-elect in an official statement earlier this week.