Agence France Presse (AFP)
March 16, 2009 - 12:00am

Egypt's Foreign Minister Ahmad Abul Gheit voiced concern Monday for Middle East peace hopes after an ultra-nationalist party signed up to be part of Israel's new government.

"We have a negative, possibly damaging factor, which is the emergence of an extreme right government in Israel," he told members of the European Parliament in Brussels.

Earlier Monday, Israeli prime minister designate Benjamin Netanyahu took the first step toward forming a right-wing government by inking a coalition deal with the Yisrael Beitenu party of Avigdor Lieberman.

Lieberman, a controversial firebrand slammed as a "racist" by critics, is due to become the foreign minister in the new government.

Gheit expressed fears about the new government, saying that "if they would implement what they've been talking about over the last few years, we would all of us face dire difficulties and face the most extreme of situations."

However Netanyahu's Likud and Yisrael Beitenu included a clause in their agreement that stressed their preference for a broader unity cabinet and said the portfolio distribution would change if such a union were formed.

A narrow right-wing government is likely to put Israel at odds with its main ally the United States because it would probably put the brakes on the already hobbled peace negotiations with the Palestinians.

EU foreign policy chief Javier Solana said Europe "would be ready to do business as usual with a government in Israel that is prepared to continue talking and working for the dual state solution."

"If that is not the case, the situation will be different," he said.

French Foreign Minister Bernard Kouchner said the European Union had no choice but to work with whatever government is in power if the EU wants to have an influence on Middle East peace moves.

"Whatever happens, we will work with the Israeli government," he said. "There is no other solution."

"We are not going to reject the interlocutors who appear, otherwise there will be no more interlocutors," he told reporters at the parliament.


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