CAIRO — The Arab League has welcomed Paraguay's decision to relocate its embassy from the contested city of Jerusalem back to Tel Aviv.

Saeed Abu Ali, assistant to the league's secretary-general for Palestinian affairs. told reporters Thursday the move serves as a model for other countries in the face of Israeli plans and U.S. pressure. He also said it will also positively reflect on Arab-Paraguayan relations.

Abu Ali hailed Paraguay's move as being on the "right track" and in accordance with international legitimacy resolutions.

Paraguay had moved its embassy to Jerusalem in May after Guatemala and the U.S., infuriating Palestinians who seek east Jerusalem as a future capital.

Paraguay reversed its decision Wednesday prompting Israel to shutter its embassy in Paraguay and warn that ties between the countries would be "strained."