CAIRO, May 1 (Yasmine Saleh/Reuters) - Arab League nations on Saturday endorsed a resumption of negotiations on the Palestinian-Israeli conflict, raising hopes that indirect talks brokered by the United States could revive the stalled peace process.

Arab League Secretary General Amr Moussa told reporters after a meeting of Arab officials in Cairo that the regional body would back indirect negotiations between Palestinian and Israeli officials.

The timeframe of indirect talks will not change from what was agreed to in March, and there will be no change from indirect talks to direct talks until after the outcome of indirect talks has been assessed, he said.

Arab League backing is key if Palestinian President Mahmoud Abbas is to risk opposition from Palestinian hardliners backed by Syria and Iran and embrace negotiations that have been on hold since the three-week Gaza war began in December 2008.

Chief Palestinian negotiator, Saeb Erekat, told Reuters the condition for Arab League support would be a halt of settlement activity in the West Bank. If Israel builds one house in the West Bank, Palestinians will immediately stop the negotiations.

He said a final decision would be made by the Palestinian Liberation Organization executive committee next week. It was a very positive meeting and they made a consultative decision on engagement in proximity talks for four months.

In March, a majority of Arab League nations backed the talks, but later retracted the decision after Israel announced it would erect 1,600 settler homes in an area of the occupied West Bank that the Israelis annexed to East Jerusalem.

Israel has refused to freeze such projects, calling Jerusalem its indivisible capital -- a status not recognized internationally. Palestinians want a capital in East Jerusalem.


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Israeli Prime Minister Benjamin Netanyahu did, however, declare in November a limited moratorium on other West Bank settlements. Praised by Washington as a goodwill gesture, the moratorium expires in September.

Netanyahu's spokesman said the prime minister welcomed the Arab League decision, adding that Israel wants to renew the peace talks with the Palestinians any time and any place, on condition this is done without preconditions.

Syria and Lebanon did not support the Arab League statement, Syria's ambassador said, demanding more from Israel before talks could resume.

This committee has exceeded its authority and given the Palestinians the green light to start indirect talks without the Israelis taking steps on the ground, Yousef al-Ahmed said.

On Friday, U.S. Secretary of State Hillary Clinton said she expected indirect talks to begin next week with U.S. special envoy George Mitchell returning to the region to try to energize a peace process that is a key U.S. foreign policy goal.

An Israeli political official said Mitchell was expected to visit the region on Monday.

Abbas had insisted Israel freeze Jewish settlement building before he would come to the negotiating table. But Palestinian sources have suggested he might accept a delay to some Jewish housing projects instead and have spoken of an unwritten commitment from Mitchell to assign blame publicly to any party that jeopardizes the talks.

Erekat said the Palestinian side had been given positive indications by the United States but declined to elaborate.

Netanyahu is planning to visit Egyptian President Hosni Mubarak next week. Egypt was the first Arab nation to sign a peace treaty with Israel. (Additional reporting Ayman Samir in Cairo and Dan Williams in Jerusalem)