MIDDLE EAST:US secretary of state Condoleezza Rice expressed concerns yesterday that the ceasefire between Israel and the Palestinians was "quite fragile", but added that she hoped "we can take this moment to accelerate our efforts towards the two-state solution that we all desire".
Dr Rice was speaking after meeting Palestinian president Mahmoud Abbas in Jericho to try and build on the ceasefire and on conciliatory comments made earlier this week by Israeli prime minister Ehud Olmert. Mr Olmert called for renewed dialogue with the Palestinians.
Mr Abbas, however, confirmed earlier reports by declaring that talks with the ruling Hamas party over forming a national unity government had reached a "dead end" - a development that could complicate efforts to solidify and extend a shaky ceasefire and inject new life into peace talks that have been in a state of deep paralysis for over six years.
A truce went into effect on Sunday in Gaza, with Palestinian militants agreeing to halt rocket fire into Israel and Mr Olmert agreeing to halt all military operations in the coastal strip. Agreement has yet to be reached over extending the ceasefire to the West Bank.
In her meeting later in the day with Mr Olmert, Dr Rice praised the Israeli leader's speech in which he said Israel would evacuate large tracts of territory and dismantle many settlements if the Palestinians renounced violence and relinquished their demand for the right of return of refugees.
A statement released by the prime minister's office said that Dr Rice had described the speech as "an important step that was likely to both contribute towards calm and advance the peace processes in the region."
Mr Abbas's efforts to set up a Palestinian national unity government appear to have faltered over disagreements about who will control the interior ministry, which is in charge of the Palestinian Authority security forces, and who will hold the purse strings. "We have exerted efforts, we have worked in many directions, but unfortunately we have hit a dead end," Mr Abbas said after his hour-long meeting with the secretary of state.
The Palestinian leader hopes that by setting up a unity government he will be able to convince western countries to lift crippling sanctions they imposed after Hamas came to power earlier this year. Hamas has been reluctant to accept conditions set by the international community for the removal of sanctions, including a renunciation of violence and recognition of Israel.
Mr Abbas could evoke his presidential powers and dismiss the Hamas government in a bid to bring about new elections, but there is no guarantee his more moderate Fatah party would win them and such a high-risk move could spark bloody civil strife between Hamas and Fatah supporters.
Hamas prime minister Ismail Haniyeh rejected the claim that unity government talks could no longer be salvaged.
Speaking on a visit to Cairo, he said that "the door must not be closed".
Mr Olmert has said that if Palestinian prisoners are to be released and talks are to be renewed, the Palestinian government will have to recognise Israel and militants holding an Israeli soldier captive in Gaza will have to release him. If there is no unity government, however, and sanctions remain in effect, a political breakthrough will become increasingly unlikely and renewed violence will beckon.