The Associated Press
October 22, 2008 - 8:00pm

A long-stalled Arab peace initiative could bring peace to the Middle East _ still riven by the Israeli-Palestinian conflict _ the Israeli President Shimon Peres said Thursday, making his first endorsement of the proposal in an Arab country.

Egyptian President Hosni Mubarak, however, openly disagreed with Peres during a joint press conference, saying Palestinians and Israelis must reach a bilateral agreement before Arab states could consider normalizing relations with the Jewish state.

Peres has recently been lobbying to jump-start a 2002 Saudi proposal offering pan-Arab recognition of Israel in exchange for withdrawal from Arab lands captured in 1967.

The plan has been endorsed by 22-member Arab League, but seen little progress since then.

"In tandem with the bilateral negotiations with the Palestinians, we need to promote the Arab peace initiative," Peres told reporters after his meeting with Mubarak at the Red Sea resort of Sharm El Sheik.

Peres, a Nobel peace prize winner whose presidency is largely ceremonial, said the Saudi plan "needs to be negotiated" further, but that it was "correct," in spirit.

A U.S. ally, Egypt is a regional heavyweight and was the first Arab country to sign a peace treaty with Israeli in 1979, but Mubarak said discussions of wider peace agreement were off the table because the Saudi initiative is not "open for negotiations."

His spokesman, Suleiman Awwad, later said Mubarak dismisses the idea of all Arab countries holding talks together with Israel before the Palestinian issue is resolved.

On Sunday, Israeli Defense Minister Ehud Barak said Israeli leaders were seriously considering the dormant Saudi plan and that he had discussed it with Prime Minister-designate Tzipi Livni.

"There is definitely room to introduce a comprehensive Israeli plan to counter the Saudi plan that would be the basis for a discussion on overall regional peace," Barak told Israel's Army Radio.

Israel wants to retain some of the land captured in the 1967 war and objects to language in the initiative that appears to endorse a large-scale return of Palestinian refugees to lands inside Israel. Israel says a massive influx of Palestinians would destroy the country's Jewish character.

Peres and Mubarak said they also discussed the fate of Gilad Shalit, a kidnapped Israeli soldier, held in the Gaza Strip.

"Egypt will continue its persistent efforts to mediate and ensure success of a Shalit release deal and the Palestinian prisoners deal," Mubarak said.

Egypt has been brokering a potential prisoner exchange between Israel and Gaza's Hamas leaders. Hamas is holding an Israeli soldier, captured more than two years ago in a cross-border raid from Gaza into southern Israel.


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