JERUSALEM (AFP) - An Israeli policeman shot in the head in an attack earlier this month outside the walls of Jerusalem's Old City died of his wounds on Wednesday, police said.

"A border policeman passed away from wounds he received from a terrorist attack," police spokesman Micky Rosenfeld told AFP, referring to the July 11 attack in which an unidentified gunman opened fire on a group of police.

The attacker escaped through a nearby cemetery and has not been caught.

News of the policeman's death came one day after a Palestinian from east Jerusalem ploughed through a busy downtown Jerusalem street in a bulldozer, destroying several cars and wounding 16 people before being shot dead.

The incident appeared to be a copycat attack modeled on a similar bulldozer rampage at the start of the month that killed three people and wounded dozens of others.

In the wake of the attacks Israel has mulled taking new security measures in mostly Arab east Jerusalem, occupied and annexed in the 1967 war, including a return to punitive housing demolitions.

Since Israel and the Palestinians formally relaunched US-backed peace talks in November, 528 people have been killed, the vast majority of them Palestinians, according to an AFP tally.

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