President Abbas to inform Palestinians about outcome of talks with Israel

Palestinians will not give up refugees’ right to return, Jerusalem issues

Olmert focuses on negotiations with Syria as clamor increases for resignation

Barak calls for Israeli premier’s resignation, early elections

A spokesman for Palestinian Presidency denied reports that President Mahmoud Abbas was considering resignation if no peace deal is reached with Israel in six months.

"Such reports which come from time to time are untrue and has no basis," said the spokesman Nabil Abu Rdineh.

The reports quoted Yossi Beilin, a left-wing Israeli lawmaker, as saying that Abbas had told him about his intention to resign if Israel and the Palestinian National Authority (PNA) fail to achieve a peace deal during the coming six months.

At their meeting during the World Economic Forum in the Egyptian city of Sharm el-Sheikh, Abbas told Beilin that the coming six months "will be decisive and fateful."

The Palestinians and Israel plan to reach the deal before U.S. President George W. Bush quits the White House at the beginning of 2009. In last November, the U.S. efforts have succeeded to resume Israeli-Palestinian peace process.

Meanwhile, Palestinian negotiator Saeb Erekat said Abbas was still committed to the peace negotiations aiming at the creation of an independent Palestinian statehood, "but he will look into his options if no deal is reached by the end of 2008."

"Abu Mazen (Abbas) told us he has open options," Erekat added.

Presidency Spokesperson Nabil Abu Rdeina said that the statements of the Israeli government requesting to abandon the right of return could not lead to any progress, but put obstacles on the path of negotiations.

Abu Rdeina warned of imposing facts beyond the negotiating table, affirming that the refugees issue is one of the key issues such as the issue of Jerusalem.

Abu Rdeina added that such statements are an attempt to escape from commitments and harm the peace process.

President Mahmoud Abbas stressed that the right of return is sacred and never be delayed.

In the opening of the 'Return Key' statue in Aida refugee camp near Bethlehem, President said that sixty years and six days elapsed on our departure from our homeland which is in our hearts, minds, hopes and dreams.

'This key, which is the biggest key in the world, is the symbol of our return, our hopes and our dreams. This key will remain a alive until we return home, God willing, nothing will hinder us and we will not abandon our dream,' President added.

President made it clear that we are determined in every word and phrase on the right of refugees to return which is a sacred right, and never be delayed or postponed.

Israel had ruled out all debate on letting Palestinian refugees return in any peace deal. As Bush flew out after three days of celebrations of Israel’s 60th anniversary, an Israeli government spokesman said Palestinian insistence on the right of return for 4.5mn refugees and their descendants was “the ultimate deal breaker”.

Six months into negotiations sponsored by Bush in the hope of a deal before he leaves the White House, Prime Minister Ehud Olmert’s spokesman used some of the toughest Israeli language yet to insist that President Mahmoud Abbas abandon 60-year-old refugee claims if he wants to establish a Palestinian state.

“This demand, which does not exist under international law, for right of return, is the ultimate deal breaker. You cannot have peace and this demand at the same time,” Mark Regev said.

Some 700,000 people, half the Arab population of Palestine in May 1948, fled or were driven from their homes when Israel was created. Letting them and their families live in Israel now would undermine its nature as a Jewish state, Israel argues.

It also disputes the legal basis of the right of return first set out in a UN resolution of December 1948.

Bush, who steps down in January, made little reference to the peace negotiations or to the Palestinians at all while in Israel. Many Palestinians were dismayed by a speech to Israel’s parliament in which he spoke of a shared divine providence uniting American Christians like himself with Israel’s Jews.

Palestinian negotiator Saeb Erakat said: “He should have told the Israelis that, 1 mile from where he was speaking, there is a nation that has lived in disaster for 60 years. He should have told the Israelis no one can be free at the expense of others. He missed this opportunity and we are disappointed.” Bush called Israel a homeland for God’s “chosen people” and pledged Washington would remain its “best friend in the world”.

As Palestinians in the occupied West Bank and Gaza Strip and in camps abroad held protests on the 60th anniversary of their exile from cities and farmlands that are now in Israel, Bush spoke of European Jews in 1948 “arriving here in the desert”.

In the Palestinian newspaper Al Ayyam, columnist Samih Shabib wrote: “Bush is blind to the right of return.

“The US administration’s attitude towards Israel inherently promotes hostility and deepens hatred towards the US and its policy. Is this hostility, and its consequences, in America’s interest? I don’t think so.”

Olmert’s spokesman Regev acknowledged the suffering of Palestinian refugees but insisted Abbas must abandon their claims if he wanted a Palestinian state, 60 years after Arabs rejected a UN plan to partition Palestine into two states.

“We are not insensitive to suffering that the Palestinians or the Arabs have gone through,” he told reporters.

But he added: “The so-called right of return is antithetical to a two-state solution ... I would question someone’s commitment to peace and reconciliation if they believe that the so-called right of return must be implemented.”

There was no immediate reaction from Palestinian officials.

Though there have been few obvious signs of progress toward a peace deal, both Olmert and Abbas have pressing domestic reasons for presenting some sort of accord, even if many analysts believe both are too weak at home to implement it.

Some see Abbas’s reference to proposals for an “agreed and just” settlement of the refugee issue as a sign he might accept, despite strong resistance among his people, a deal that gives a few people a chance to recover homes and compensates the others.

In return, though again in the face of solid domestic opposition, Olmert may be ready to let the Palestinians have part of Jerusalem for a capital and give up other occupied land.

Meanwhile, Prime Minister Ehud Olmert told lawmakers that Israel was left with no choice but to launch indirect peace talks with Syria, a top Israeli official said.

"What tipped the scales was the burning question of what might happen if, heaven forbid, we would be drawn, due to a miscalculation, into a violent confrontations with Syria," he told parliament's foreign affairs and defense committee.

"Then, I would be asked: How can it be that they were seeking peace and you did not even examine the possibility?" Olmert told the committee which meets behind closed doors.

"Anyone in my chair understands that these moves need to be made with the utmost caution, and secrecy is a necessary part of that," said the premier, noting that he initiated the process with Syria in February, 2007.

"There is not a single party in the world that told Israel not to negotiate for peace...I certainly shared our thoughts and developments with our closest friends," Olmert said, referring to the U.S., Israel's key ally.

Syria and Israel announced last week that they have launched indirect peace talks, through Turkey's mediation, after an eight-year freeze.

Damascus wants to negotiate the return of the Golan Heights, seized by Israel in the 1967 Middle East war, but opinion polls show that about two thirds of Israelis are opposed to giving up the strategic plateau now home to some 20,000 Jewish settlers.

Defense Minister Ehud Barak also defended the indirect dialogue with Syria, saying it was in Israel's interest for Damascus to renounce violence.

"But we need to understand that the Syrians are concerned above all about their regime, about their role in Lebanon, their relations with the United States, and the Golan," Barak told members of the Labour party in parliament.

"Among their priorities, peace with Israel is a relatively minor concern," Barak said.

"The two sides understand that these will be long and complex negotiations, requiring difficult decisions," he said. While Olmert has said the talks would be conducted in secrecy, the Syrians apparently have not made that pledge.

"Syria is in favor of a just and lasting peace. Syria rejects any secret negotiations or contacts with Israel. Any action taken by Syria in this area will be revealed to the public," official media quoted Syrian President Bashar Assad as saying on April 20.

Israeli Prime Minister Ehud Olmert said that indirect peace talks with Syria, a process begun more than a year ago and confirmed this week, will be conducted seriously and in secrecy.

"We have no intention to conduct these negotiations neither in the media, nor in daily statements, nor in slogans," Olmert said before the weekly cabinet meeting.

"I can say we are taking these negotiations seriously. There has been, and will be, very precise and detailed preparations, which are appropriate for the expectations we have of these negotiations, given the current reality, not that of nine or 10 years ago."

"Israel would have made a mistake had it decided to abort the talks with Syria. We must brace ourselves for long negotiations," an official quoted Barak as saying during the cabinet meeting.

Polls show that public opinion in Israel opposes withdrawing from the Golan, now home to some 20,000 Jewish settlers and military installations. Interior Minister Meir Sheetrit suggested the disputed region could be leased from Syria as part of a future peace deal.

"I propose leasing the Golan from the Syrians for 25 years. If they are serious about peace they have nothing to lose," said Sheetrit, a member of Olmert's centrist Kadima party.

Sheetrit said he was prepared to recognize Syrian sovereignty over the Golan, but a leasing period would allow for the gradual removal of Jewish settlers there.

Former army chief Dan Halutz also joined the debate, claiming that Israel can manage without the plateau bordering the Sea of Galilee, the country's main source of fresh water.

"We can manage without (the Golan) as we did in the past," Halutz said on military radio.

"When we launch discussions with Syria, everyone knows what is on the table and we must explore all possibilities to make peace with our enemies," said Halutz, who quit in January 2007 over criticism of his handling of the 34-day Lebanon war against the Iran- and Syria-backed Hezbollah militia.

Israel is demanding that Damascus break off its ties with Iran and the Palestinian Islamist movement Hamas and Lebanon's Shiite Hezbollah. Syria has said it would reject any preconditions in the talks that call on Damascus to change its relations with other countries or groups.

Israel considers Iran to be the greatest threat to the region with its disputed nuclear program. Both Israel and the United States believe Tehran is covertly developing an atomic bomb -- a charge Iran denies.

Iran and the indirect peace talks with Syria will be among the topics Olmert discusses with US President George W. Bush during a three-day visit to Washington from June 3.

The main focus will be on peace negotiations with the Palestinians, re-launched in November, that have so far made little tangible progress despite heavy US pressure.

Israeli Defense Minister and Labour party chairman Ehud Barak demanded that Prime Minister Ehud Olmert step down over corruption allegations.

"I think the prime minister has to disconnect himself from running the state," Barak told a news conference in parliament.

"I don't mind if he suspends himself, takes leave or resigns," said Barak.

Labour is a key ally of Olmert's Kadima party in the government coalition. "Unless Kadima acts and a new government that we support is formed in parliament we will work to decide on a new agreed early date for elections," Barak said.

Barak, a former premier, made the remarks one day after a wealthy US financier testified before a Jerusalem court that he gave Olmert 150,000 dollars to fund his political ambitions and perhaps his lifestyle.

"I don't think that the prime minister can simultaneously run the government and take care of his personal affairs," Barak said.

Olmert's spokesman, Mark Regev, said the prime minister was continuing his daily schedule. "It's business as usual," Regev said.

Although Barak stopped short of setting a firm deadline, his comments made it extremely difficult for Olmert to stay in power. If Labour withdraws from the coalition, Olmert would lose his parliamentary majority.

Israel's popular foreign minister, Tzipi Livni, would become caretaker prime minister if Olmert stepped down. The party then could try to form a new government, and if that effort failed elections would likely ensue.

Livni and other Kadima leaders have remained silent since Tuesday's damaging court testimony, although one junior Kadima legislator, Amira Dotan, urged Olmert to resign. The Israeli media reported that several ministers already were positioning themselves to replace Olmert.

Olmert is the latest in a long line of Israeli leaders plagued by scandal. Former prime minister Ariel Sharon was accused of campaign funding violations, as was Barak himself when he was prime minister in 2000. Former Israeli president Moshe Katsav was forced to resign in June 2007 under a cloud of rape and sexual assault charges.

The current investigation into Olmert's dealings is the fifth since he became prime minister. He has yet to be charged with any offence, although the current scandal seems the most serious.

It appears Olmert's best hope for survival is Barak not following through on his threat, as happened last year when the Labour leader failed to honour a vow to leave the government after a damaging report on Olmert's handling of the 2006 Lebanon war.

One thing that might keep Barak from bolting the government is the candidacy of hardline politician Benjamin Netanyahu, whose rise to power for a second time could freeze Israel's peace efforts.

Israeli prosecutors are investigating tens of thousands of dollars in donations collected by Olmert before becoming prime minister in 2006. They suspect he may have violated campaign finance laws or accepted bribes.

The key witness in the case, U.S. businessman Morris Talansky, testified that he personally gave Olmert $150,000 over 15 years, often in cash-stuffed envelopes.

Talansky said he gave Olmert money beginning in 1991. Olmert became Jerusalem mayor in 1993, serving for a decade at the end of which he was named ministry of industry and trade.

Talansky, 75, said he did not get anything in return for the money. Instead, he said he overlooked questions about Olmert's request for cash due to his admiration for Olmert and his belief in Olmert's ability to unite the Jewish people.

Olmert's lawyers are scheduled to cross-examine Talansky on July 17. Talansky's testimony was the latest blow to Olmert, who has been deeply unpopular since Israel's inconclusive war against Hezbollah in Lebanon in 2006.

It remains unclear what, if any, Israeli laws Olmert may have broken. After the hearing, State Prosecutor Moshe Lador said it was "too early" to draw any conclusions about a possible indictment.

"This whole investigation is not at the end, but in the middle," said Lador, who led Tuesday's questioning of Talansky. "No decisions have been made, no decisions are now even considered."

The deepening scandal, however, is dominating the Israeli media and threatening to undermine Olmert's attempts to broker elusive peace deals with Palestinian Authority President Mahmoud Abbas and Syrian President Bashar Assad.

While Olmert's lead attorney described Talansky's testimony as "twisted," the New York businessman's sworn testimony raised significant questions about the prime minister's fundraising in the United States.

Over the course of six hours, Talansky displayed an increasing disillusionment with Olmert that built over the last 15 years.

After he was caught up in the investigation, Talansky said, he wanted to confront Olmert so he could express his "anger" about the Israeli leader's conduct.

"This is no way to build a relationship, to run a country, to be a high official," said Talansky. "By taking cash all the time."

In one case, Talansky said, Olmert asked him for a $25,000 loan because he was going on an Italian vacation.

After he'd given Olmert cash for years, Talansky said, in 2005 the Israeli leader asked three prominent American businessmen to talk to him about his struggling new mini-bar business.

State prosecutors presented a letter Olmert wrote to American casino billionaire Sheldon Adelson on Talansky's behalf three weeks after Talansky paid a $4,000 hotel bill for Olmert, who was then vice prime minister in Prime Minister Ariel Sharon's coalition government.

Around the same time, prosecutors said, Olmert wrote a letter to the defense minister of Chile about another investment Talansky was involved with that sold satellite space to nations around the world.

Talansky said he knew nothing about Olmert's letter to Chile and said the Israeli leader's attempts to help him with his mini-bar business did no good.

"I said to myself, never go to a politician for business," said Talansky, who denied that he gave Olmert money with the hope of getting anything in return.

The court allowed state prosecutors to question Talansky in court to ensure that his testimony is documented before he returns to the United States this week.

Talansky has agreed to return in July when Olmert's attorneys, who asked for more time to prepare, will question the businessman.

After the hearing, Olmert attorney Eli Zohar called Talansky's testimony "twisted."

"Come back in July and you will see what picture you will get from the whole story," said Zohar.

Talansky could be cast as an unreliable witness, and Olmert's attorneys may try to question the businessman about a series of lawsuits in the United States in which he's alleged to have used threats and intimidation to try to collect debts.

Talansky emerged as a key player in the investigation last month and was brought in for questioning when he returned to Israel for Passover.

Wearing a black skullcap, the white-haired Talansky quickly shed his gray jacket and tie after he entered the small courtroom to begin his testimony.

Talansky appeared uncomfortable in his role. He slumped in his seat, grimaced at some of the questions and angrily accused police interrogators of treating him like a criminal.

Speaking in English throughout the hearing, Talansky broke down twice on the stand, once when he implored the court to let him return to New York to be with his wife and once when he accused Israeli police interrogators of painting him as a criminal.

"They destroyed my family," Talansky said as he wept on the stand. "You can never, never redeem the people who did it to me, (they) can never redeem themselves for destroying the trust of children in their father and grandfather."

Talansky blasted the Israeli judicial system and lectured the court on American interrogation methods. At one point, he cast the investigation as a stain on Israel that would hurt the nation's ties with American Jews.

"I can't understand how we are hurting ourselves," said Talansky.