The Vatican delegation, which included Undersecretary for Relations with States Bishop Ettore Balestrero, made the pledge to repair the world's oldest church after meeting with the Palestinian Authority's Foreign Minister Riyad al-Maliki, according to Ma'an news outlet.
The talks on the 1,700 year-old church also included Palestinian Authority adviser on Christian Affairs, Ziad Bandak. It was built in 399 over a cave, is believed to be the true birthplace of Jesus, and was rebuilt after a fire in the sixth century. Over two million people visit the Church of the Nativity every year.
Officials from the Holy See were in the region for a series of negotiations on economic matters concerning the Church in Israel. As a part of those meetings they met with Israel's Deputy Foreign Minister Daniel Ayalon in Jerusalem.
According to Vatican Radio, Israel and the Holy See's meeting on Jan. 29 was "serious and constructive" regarding the Church's fiscal issues.
The Bilateral Permanent Working Commission issued a joint statement saying it "took note of the fact that significant progress has been made and calls for a rapid conclusion of the agreement."
Discussions included negotiations on article 10, paragraph 2 of the Basic Agreement signed between the Holy See and Israel in 1993.
The Holy See and Israel, which have been in ongoing negotiations for 14 years, agreed to meet again for a plenary meeting in June.
The Fundamental Agreement, a series of negotiations launched on Dec. 30, 1993, is aimed at defining the rights of the Catholic Church in the Holy Land.
After the latest series of talks, the Holy See and Israel could be on the verge of reaching a legal and financial agreement.
This means the Church in Israel would be exempt from taxes on religious property, as it was before the State of Israel was created in 1948.
The Vatican has promised to donate $135,490 U.S. dollars (100,000 Euros) to the Church of the Nativity in Bethlehem during a recent visit by Church officials to the Holy Land.