Tokyo: Israeli Prime Minister Ehud Olmert said on Tuesday he would make every effort to reach an agreement with Palestinians that would lead to a two-state solution resolving decades-old conflict.

"In these days we are making exceptional efforts to conclude all differences with our neighbours and to resolve outstanding disputes with our Palestinian neighbours," Olmert told a business conference in Tokyo, where he is making his first visit as Prime Minister.

Olmert and Palestinian President Mahmoud Abbas met last week and agreed to accelerate US-backed peace talks launched in Annapolis, Maryland, in November after critics said Israel was  not doing enough to get a deal this year.

"We have a desire to reach an agreement within the year 2008. I am not sure we will make it, but we are determined to make a giant step forward to end this dispute once and for all."

Olmert is due to meet US Secretary of State Condoleezza Rice in Tokyo on Thursday to update her on the peace talks and growing tensions between Israel and the Gaza Strip's Hamas  leaders.

"There will be no better opportunity, and we want to make every possible effort to seize this opportunity," said Olmert, who is to meet Japanese Prime Minister Yasuo Fukuda on Wednesday.