Israelis and Palestinians have never been closer to making strategic decisions than they are today, and at the end of the day, each side wants to win a little more than the other, Sheikh Abdallah Nimr Darwish, founder of the Islamic Movement, told President Shimon Peres on Tuesday. "But the Palestinians have nothing left to offer Israel," he added.

Darwish spoke at the traditional Iftar meal for leaders of Israel's Arab communities hosted by President Shimon Peres during Ramadan.

"The Palestinians can't give up any more," said Darwish, without elaborating on what they have already ceded.

There was agreement on both sides, he said, that Israel would return to the 1967 borders, with possible exchanges of territory.

Turning to Peres, Darwish entreated the president to pressure the government into realizing that the Palestinians have given as much as they can and that Palestinian Authority President Mahmoud Abbas "wants to live out his days in a free, independent state of Palestine."

Darwish said that Palestinians who are Israeli citizens were pained by the suffering of Palestinians in Gaza who live under an Israeli blockade and were "frequently subjected to intrusions into their lives by Israelis soldiers."

Although Israeli Arabs wholeheartedly support the creation of a Palestinian state, continued Darwish - whose statement was reiterated by Shawki Hatib, chairman of the Higher Arab Monitoring Committee and Science, Culture and Sport Minister Ghaleb Majadle - Israel's Arab sector should not be regarded as a security threat.

Majadle went further and asked Peres to join him in eradicating racism against Arabs. He reminded Peres that when they had presented a cup to the Betar Jerusalem soccer team, the team's coach and various "academics and other well-educated people" had refused to shake the hand of an Arab minister. "Racism against Arabs is on the rise," he said. "It's not just our problem. It's your problem."