Israeli PM Olmert in coalition talks with Labour

MIDDLE EAST:   Acting Israeli prime minister Ehud Olmert yesterday announced that he will seek to form a coalition with the …

MIDDLE EAST:  Acting Israeli prime minister Ehud Olmert yesterday announced that he will seek to form a coalition with the centre-left Labour Party, an alliance that would boost his plan to withdraw from much of the West Bank and draw Israel's final borders by 2010.

The announcement came after a meeting between Mr Olmert, head of the centrist Kadima Party, and Labour's leader, Amir Peretz. The meeting signalled the end of a rift between Mr Olmert and Mr Peretz that began after last week's national election.

With Mr Peretz standing next to him during a news conference, Mr Olmert said: "We are happy to announce that immediately after the president gives me the mission of putting together a government, we will open coalition talks that will allow us to form a government in which the Labour Party will be a senior member."

In last week's election, Kadima emerged as the largest party in parliament with 29 out of 120 seats, followed by Labour with 19 seats.

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Under Israel's electoral system, the leader of the largest party is traditionally asked by the president to try to form a coalition. However, Labour initially recommended to the president that its leader, Mr Peretz, be asked to form the government.

It was not clear whether this was an attempt by Labour to pressure Mr Olmert in coalition talks.

Mr Peretz, an ex-union boss, wants to become finance minister, a demand Mr Olmert is loath to meet.