Roula Khalaf
The Financial Times
February 17, 2009 - 1:00am

It will be weeks before the real Israeli election winner emerges, but one thing is clear. Whether a coalition led by Tzipi Livni's Kadima or Benjamin Netanyahu's Likud prevails, the public's shift to the right ensures that there are losers beyond the Jewish state's borders.

One of them is Mahmoud Abbas, the embattled president of the Palestinian Authority, who has been desperately seeking a revival of a peace process.

With more than half the Knesset seats now occupied by rightwing, far-right or religious parties, the formation of a Palestinian state is unlikely to feature high on the list of the next government's priorities.

Yet Mr Abbas cannot afford a prolonged stalemate: his standing was in free-fall before the election, partly because of his botched handling of Israel's Gaza offensive.

One recent poll shows electoral support for Mr Abbas's secular, nationalist Fatah falling to 27.9 per cent from 34 per cent last April, compared with more than 28 per cent for Hamas, the Islamist target of the Israeli assault in Gaza - up from just over 19 per cent.

While Hamas shares the blame for the shift in Israeli politics, it can now claim to be vindicated. Did it not argue that Israelis were not interested in a peace settlement? It might even assume that pressure on it to recognise Israel will ease, given that many rightwing Israeli MPs question Palestine's right to exist.

The second victim of the election is Arab moderation, which had, like Mr Abbas, taken a battering during the offensive as an enraged public lashed out at prowest governments for their failure to stop the war.

With little progress expected on the peace front, Arab governments can expect a more radicalised public opinion. The timing could not be worse. With oil prices falling, the region's economic boom fading and no willingness to open up their political systems, governments will struggle to contain frustrations. And they will rush to Washington for help.

The problem they will find is that the third loser in the Israeli election could be Barack Obama's new Middle East policy. Despite domestic economic disarray, the US president has stuck to his promise to address the Arab-Israeli conflict early on, extending a hand of reconciliation towards Muslims and swiftly naming a Middle East envoy.

George Mitchell's job was never going to be easy. The Palestinians are divided and there are vast differences between their requirements for peace and what Israel has been willing to deliver. Now his job has been made almost impossible. The best he might be able to achieve is to stop tensions bursting into new violence, whether in Gaza, in neighbouring Lebanon or in Iran.

And while it is doubtful that Israel and Syria will conclude a peace agreement on the return of the occupied Golan Heights in the near future, both sides may find it convenient to enter into negotiations.

At least then the illusion of progress on Middle East peace might be maintained while pressure for Israeli- Palestinian talks weakens - not the hopeful scenario the region has sought, but a way of buying time until the Palestinians sort themselves out and Israelis return to the ballot box.


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