Israeli Prime Minister Benjamin Netanyahu announced on Wednesday tougher penalties for stone throwers, a move that follows a third day of clashes in and around Jerusalem's flashpoint Al-Aqsa mosque compound.

Young Palestinian demonstrators threw stones at Israeli police who had entered the compound in large numbers and responded with stun grenades in fresh clashes on Tuesday despite international calls for calm.

Netanyahu's announcement at the start of an emergency meeting of ministers and security officials came after the death of an Israeli driver who lost control of his car after apparently being hit by stones in Jerusalem on Sunday.