US Secretary of State Rice demanded from Israel and the Palestinians yesterday to hold talks on the basic issues that can lead to the establishment of a Palestinian state. Rice told reporters upon her return to Washington: eventually, the issues of the refugees, borders and Jerusalem have to be solved. On the expected meeting between Abbas and Olmert next week, she said: I don’t want to predict what they will be talking about but I admire the seriousness of both men to achieve real progress towards the two state solution. Rice called during a joint press conference with President Abbas in Ramallah yesterday for deepening the dialogue between the Palestinians and Israelis on all issues that will lead eventually to the establishment of a Palestinian state. Rice announced that Israel is ready to discuss "the basic issues" pertaining to the establishment of a Palestinian state. She said on her way back to Washington: I affirmed this time more than before to realize what will be offered to the Palestinian people who want a life better than what Hamas offers them in Gaza.

Israeli officials talk about reaching with Abbas "An Agreement of Principles" for the establishment of a Palestinian state. During the press conference with Rice, Abbas talked about negotiations to reach a "declaration of principles". He said the Palestinians need to know what would be the end result of the game in their talks with Israel. Before the start of talks with President Abbas, Rice signed with the government of Salam Fayyad an $80 million agreement to reinforce and develop the capacities of the Palestinian security services. Rice said this assistance is to finance the security reform and this is part of an international effort to reinforce the capacities of the security services.

In the meantime, Israeli Debka file website said the following:

Olmert approves American plan for big new Palestinian town on West Bank To be situated 20 km south of Nablus and 35 km north of Ramallah on the road linking them, the town is planned for 30-40,000 Palestinian inhabitants in the first stage, expanding in the second to 70,000 ten years hence. It will be located in Area B under Israeli security control. Israeli Prime Minister Ehud Olmert has kept the project, which represents a major strategic restructure of West Bank geography, under his hat. He did not submit the American plan to the cabinet, or even the security-political ministerial forum, before giving the go-ahead to the visiting US secretary of state, Condoleezza Rice, Wednesday night, Aug. 1.

Sources report that the new town site will encompass the Palestinian villages of Qabalan, Oseria and Qudela and straddle Trans-Samaria Highway 505 opposite Tapuach junction. The US planners intend the new town to provide territorial contiguity between Nablus and Ramallah. At the same time, it will cut off Israeli villages in the Jordan Valley from the settlement blocs in Samaria.

The new Palestinian urban entity, which our sources reveal Olmert first learned about in his talks with President Bush on June 19, will be the first Arab town to go up in the region in 1,500 years, since the foundation of Ramleh.

During his White House visit, Olmert learned that the Americans regard the Palestinian town as a primary project for consolidating Mahmoud Abbas’ government. It is designed to provide tens of thousands of jobs for West Bankers, whose unemployment rate has soared to 70 percent since the Palestinian uprising was launched against Israel in 2000.

American town planners and architects hired by the US government have prepared initial diagrams after secret visits to the site. During her current tour, Rice showed the plans to the Israeli prime minister, Abbas and Palestinian Prime Minister Salam Fayyad.

The problem still outstanding is financing. It was hoped that the Saudis would put up part of the initial investment for the foundations. When he brokered the Mecca accord for a Palestinian unity government earlier this year, the monarch pledged $250 million in aid to the Palestinians. However, this hope was dashed, when King Abdullah flatly refused to hear of aid to the Abbas regime in his talks with the US secretary in Jeddah Tuesday.

Israeli Maariv newspaper said yesterday that Israel, Egypt and Saudi Arabia are working and cooperating in formulating an agreed upon formula regarding the agenda of the international peace conference to be held next autumn. The newspaper said: Saudi Arabia requested from Israel through American mediation to accept to discuss in the summit three issues in the core of the Arab-Israeli conflict: 1) the permanent borders of the future Palestinian state; 2) the status of Jerusalem; 3) the right of return of the Palestinian refugees who are not recognized by Israel.

Published at Al Ayyam & Al Hayat al Jadida NewsPapers on August 3, 2007