ISRAEL MEDIA REACTION

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SUBJECT: ISRAEL MEDIA REACTION


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SUBJECTS COVERED IN THIS REPORT:
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Mideast

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Key stories in the media:
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The media cited Secretary of State Condoleezza Rice's announcement
at a Jerusalem press conference on Tuesday that PM Ehud Olmert and
PA Chairman [President] Mahmoud Abbas had agreed to hold biweekly
meetings. Rice also sent a strong signal to Arab leaders convening
in Riyadh for Wednesday and Thursday's Arab League summit to do
their part to move the diplomatic process forward. Rice was quoted
as saying that she would meet periodically with Olmert and Abbas,
"sometimes separately, sometimes together." The Jerusalem Post
quoted US officials as saying that she was expected to come to the
region about once a month. The media quoted the Secretary as saying
that the Israeli-Palestinian meetings would "focus on two sets of
issues. First, they will discuss immediate concerns, like movement
and access, management of the passages, and preventing arms
smuggling and rocket fire by terrorists in Gaza." And secondly, she
said, "The parties will also begin to discuss the development of a
'political horizon,' consistent with the establishment of a
Palestinian state in accordance with the Roadmap. As I have noted
before, we are not yet at final status negotiations. These are
initial discussions to build confidence between the parties." The
media also quoted Secretary Rice as saying: "New thinking and new
action will also be necessary on the part of Israel's neighbors,"
giving Saudi King Abdullah special mention. She was quoted as
saying that his initiative from 2002 was an example of "such new
thinking." Yediot said that Rice's diplomatic initiative has
remained "on paper only." Media reported that, before leaving
Israel, the Secretary met in her hotel for 15 minutes with the
families of kidnapped soldiers Ehud Goldwasser and Eldad Regev, and
also with Defense Minister Amir Peretz.

The Jerusalem Post's web site quoted Foreign Minister Tzipi Livni as
saying on Tuesday night before a Kadima Party forum: "In the current
situation it is impossible to reach a political settlement with the
Palestinians." Livni was quoted as saying that the new PA unity
government was not abiding by the conditions set by the Quartet and
that Abbas was "disappointing, especially because he failed to
condition the formation of the new Fatah-Hamas coalition on the
release of captured IDF soldier Cpl. Gilad Shalit." Livni noted
that Israel had emphasized to the Palestinians that they still
needed to implement the first stage of the Roadmap, which was the
abandonment of terror.
The Jerusalem Post quoted a senior Israeli diplomatic official as
saying earlier that for the first time since 2000, Israel and the
Palestinians will begin regular discussions on all aspects of a
future Palestinian state except for borders, Jerusalem and refugees.
The official was quoted as saying that the talks Rice set into
motion would not focus on humanitarian and security issues, a
reversal of the cabinet's decision on March 18 that the
establishment of the new Hamas-Fatah unity government meant Israel
would be limited in what it could talk about with Abbas, and those
talks would continue "to advance security and humanitarian" issues.
The "most important thing to come out of Rice's visit," the official
was quoted as saying, "was that the Israelis and Palestinians
decided to resume talks on the parameters of future Palestinian
statehood, on the characteristics of this statehood." Israel's
position, however, is that talking about Jerusalem, refugees, and
boundaries now would only be a recipe for failure and another round
of violence. But, the official said, "the idea is to talk about
everything else," and when there is progress on those issues, to go
back and tackle the tough-nut core issues. The talks will be
carried out with Abbas, and not with the Hamas-led PA government.
The official was quoted as saying that despite Abbas's weakness and
"inability to deliver," there was need to talk to someone, and Abbas
was the natural candidate. The official was quoted as saying that
detailed work on "realignment," a proposed unilateral withdrawal
from much of the West Bank, prepared in 2006 by a Justice Ministry
team headed by Aharon Abramovitch, who is currently the
Director-General of the Foreign Ministry, will be dusted off and
serve as a basis for discussions with the Palestinians. Justice
Ministry team, established when realignment was Olmert's game-plan,
mapped out the ramifications of this move on a wide range of issues,
from water to archeological sites, from economic issues to
incitement. The only thing this committee did not deal with was
where the new border would run -- but it looked at all the issues
that would need to be dealt with when a new border was established.
It was precisely these issues, the official was quoted as saying,
that would now be discussed with the Palestinians.

Israel Radio quoted Saudi FM Prince Saud al-Faisal as saying on
Tuesday, in an interview published today in the British newspaper
The Daily Telegraph, that the "lords of war" will decide Israel's
future if it rejects a blueprint for peace crafted by the entire
Arab world. The Saudi FM was quoted as saying that the Middle East

risks perpetual conflict if the peace plan fails. Yediot Washington
correspondent Orly Azolai reported from an official visit to Saudi
Arabia that, at today's opening of the Arab League in Riyadh, Saudi
King Abdullah will call for the initiation of a peace process
between the Arab countries and Israel. Yediot said that, for the
first time, the Saudis are suggesting the creation of committees in
which Israeli and Saudi teams would participate -- in Azolai's
words, "kinds of joint peace teams." Yediot wrote that the teams
would discuss progress on the diplomatic track, establish
facilitative mechanisms. Yediot reported that, following the Arab
summit, UN Secretary-General Ban Ki-moon intends, in cooperation
with the other Quartet members, to initiate an international
diplomatic conference, to be attended by Israeli and Palestinian
representatives, as well as delegates from the moderate Arab states
-- Saudi Arabia, Egypt, Jordan, and the UAE. The newspaper reported
that Olmert has not yet expressed his agreement to participate in
the conference. Yediot (Smadar Perry) also reported that the US,
Saudi Arabia, and Israel have secretly formulated a
multibillion-dollar plan for a solution of the Palestinian refugee
issue. Palestinians who would remain in the host countries would
receive generous compensation, and protect to improve their lives
would be funded.

Ha'aretz reported that Hamas will refrain from expressing its views
on the Arab Peace Initiative that members of the Arab League,
including the PA, are expected to support during today's Riyadh
summit. Ha'aretz reported that on Tuesday a number of leading Hamas
figures in the Gaza Strip revealed that the organization will adopt
a policy of ambiguity on its stance vis-a-vis the peace initiative.
However, Ha'aretz wrote that senior Hamas officials admitted that
they are opposed to parts of the initiative relating to a peace
agreement with Israel or its recognition. The daily quoted
Palestinian sources as saying on Tuesday that Hamas political bureau
chief Khaled Mashal has promised Saudi Arabia's King Abdullah not to
disrupt the decisions of the summit. The same sources were quoted as
saying that the policy of ambiguity stems from concerns that open
opposition to the initiative, which is a revived version of the
Saudi initiative approved at the 2002 Arab League summit in Beirut,
will cause friction between Hamas and the Saudis.

Electronic media reported that this morning security forces are
completing the evacuation of protesters from the site of the
destroyed northern West Bank settlement of Homesh.

Former US Permanent Representative to the UN John Bolton was quoted
as saying in an interview with Yediot that the IDF's ground
operation at the end of the Lebanon War, in which 33 Israeli
soldiers were killed, did not change the UN Security Council's
resolution in Israel's favor but rather in the Arab side's. Yediot
noted that Bolton's comments contradict declarations made by Olmert
at the end of the war.

Israel Radio reported that this morning several Qassam rockets were
fired at the western Negev. The radio also said that an Al-Aqsa
Martyrs Brigades militant was killed in Jenin in clashes with IDF
forces.

All media quoted Defense Minister Peretz as saying last night before
a Labor Party audience that he intends to lay claim to the Finance
Ministry following the elections for the Labor party leadership
scheduled in late May. The declaration is meant to boost the Peretz
campaign by suggesting he is stressing the social agenda that he
traditionally espouses. Peretz announced that by the time the
primaries are held on May 28, he intends to complete the tasks he
has undertaken at the Defense Ministry. Several commentators said
that Peretz's came too late, since he should have made it
immediately after the Second Lebanon War.

Yediot reported that New York State's chief prosecutor might open a
criminal investigation against American non-profit organizations
created by Finance Minister Abraham Hirchson.

All media reported that on Tuesday five Palestinians were killed as
a sewage reservoir collapsed in the village of Um Nasser north of
Gaza, 300 meters from the border with Israel. Israel Radio reported
that Israel's national water company Mekorot will help repair the
refuse-disposal system. The radio said that the move was
coordinated between Israeli and Palestinian authorities.

Maariv reported that the festivities marking the 40th anniversary of
the reunification of Jerusalem will last for an entire year.

Ha'aretz reported that he new head of the Defense Ministry's
delegation in New York next summer is expected to be Victor Bargil,
the current chief of logistical support at the ministry and one of
the most senior and influential officials there. One of the main
obstacles to his appointment is his lack of adequate English. The
newspaper wrote that there seems to be a decision at the ministry to
send Bargil abroad for a few months of language training.

Yediot reported that underworld kingpin Zeev Rosenstein was returned
from Miami to Israel to serve the rest of his sentence.

Ha'aretz reported that on Tuesday Chinese and Israeli officials
agreed to pave the way for the first Chinese airline, most likely
Air China, to run scheduled flights between the two countries. The
newspaper also wrote that big opportunities in China continue to
attract Israeli investors despite difficulties in generating
significant profits.

Ha'aretz and other media reported that Bank Leumi, Israel's second
largest bank, is selling its US operations. Ha'aretz said that the
reason for the move is that the Cerberus-Gabriel hedge fund has no
choice in the matter if it wants to become the bank's new
controlling shareholder: US regulatory law forbids a hedge fund from
owning the controlling stake in an American bank.

Hatzofe reported that the Jewish American Charles Simonyi, a
developer of Microsoft's Word and Excel software, will be the next
"space tourist" on a Russian spacecraft.

Ha'aretz and Yediot cited the results of a Geocartographia poll,
which found that 50.9 percent of the Jewish Israeli public believes
that the state should encourage emigration of Israeli Arabs from the
country. This represents a 28-percent increase from last year. The
survey also found that 40 percent of respondents believe that the
right to vote should be taken away from Israeli Arabs -- a
55-percent increase from last year.

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Mideast:
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Summary:
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The independent, left-leaning Ha'aretz editorialized: "President
George Bush has finally joined the effort to salvage the faltering
Arab-Israeli peace process.... [But] without energetic diplomatic
activity from Washington, Bush, Olmert and Abbas will end their
tenure in office without benefiting the peoples of the region."

Senior columnist Rami Tal wrote in an editorial in the
mass-circulation, pluralist Yediot Aharonot: " It is difficult to
see why official Israel does not declare that it welcomes the Arab
initiative and is willing to launch negotiations, and at the same
time announces that it has fundamental reservations regarding parts
of this initiative, but it will clarify these during the
discussions."

Diplomatic correspondent Aluf Benn wrote in Ha'aretz: "The
assumption that nothing will come of the Olmert-Abbas bi-weekly
meetings has brought convergence [a.k.a. realignment] back into the
picture."

Conservative columnist Yosef Harif wrote in the popular, pluralist
Maariv: "The prevalent spirit in the Arab counties is that the
Israeli Prime Minister is weak and that he can therefore be
pressured. Olmert will be able to earn esteem if he proves that he
is not weak, and if he strongly rejects the plan."

Senior Middle East affairs analyst Zvi Bar'el wrote in Ha'aretz:
"Rice, and anyone else waiting for the outcome of the Riyadh summit,
will apparently have to make do with the 'ratification of the Saudi
initiative.'"

Former Israeli negotiator Gilad Sher wrote in Ha'aretz: "In a
controlled, continuous, and real dialogue process with the moderate
Palestinians, headed by Abu Mazen, one can and must advance toward a
permanent solution."



Block Quotes:
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I. "A Welcome Summit in Riyadh"

The independent, left-leaning Ha'aretz editorialized (3/28): "On
Tuesday United States Secretary of State Condoleezza Rice completed
another visit to Israel and the Palestinian Authority, as part of
her regional diplomatic tour. With less than two years left in
office, President George Bush has finally joined the effort to
salvage the faltering Arab-Israeli peace process. This effort is a
positive step forward and better than nothing, but courtesy calls
are not enough if ultimately Ehud Olmert merely agrees to regular
meetings with Mahmoud Abbas. Even though Israel is not invited to
the Arab League summit that opens in Riyadh today, it should support
the summit and be glad that Arab states, under international
auspices, are initiating a process of reconciliation with Israel....
However, the Olmert government has been derelict in its duty to its
voters and is offering arguments and excuses to avoid taking the
diplomatic bull by the horns.... Olmert, who is fighting for his
political future, is apparently more concerned about progress that
requires a withdrawal than an impasse that will mean escalation.
Rice was deterred from bringing American pressure to bear on Israel.
She established the frequency of meetings between Olmert and Abbas,
but not the content. The declared movement toward a democratic,
moderate Palestinian state, whose creation would bolster Israeli
security, was mentioned in a feeble voice. Without energetic
diplomatic activity from Washington, Bush, Olmert and Abbas will end
their tenure in office without benefiting the peoples of the
region."

II. "Why Reject?"

Senior columnist Rami Tal wrote in an editorial in the
mass-circulation, pluralist Yediot Aharonot (3/28): "In his
conversation with the UN Secretary-General, opposition chairman
Binyamin Netanyahu rejected the Saudi initiative (this is actually
an initiative of all the Arab League members) for peace with Israel,
because it mentions the right of return of the refugees and demands
a return to the 1967 borders. In any negotiations that will ever be
conducted, these will be the opening demands of the Arabs, and
Israel will reject them. There is almost no debate about this. The
question is whether the Arabs can be persuaded to reduce their
demands even before sitting down at the negotiating table, and
unfortunately it would appear that the answer to this is negative.
It is difficult to see why official Israel does not declare that it
welcomes the Arab initiative and is willing to launch negotiations,
and at the same time announces that it has fundamental reservations
regarding parts of this initiative, but it will clarify these during
the discussions. What harm could come of this?"

III. "Creeping Back to the Unilateral"

Diplomatic correspondent Aluf Benn wrote in Ha'aretz (3/28): "On
Tuesday Condoleezza Rice ended another disappointing trip into the
diplomatic minefield of the Middle East.... Olmert's flexibility
could be measured in millimeters.... Olmert is not afraid of Rice.
He perceives that President George W. Bush, concerned with domestic
affairs, is willing to let Rice venture on her shuttle diplomacy; if
she solves the conflict and a Palestinian state is established, he
will cut the ribbon and host the ceremonies. But Rice's freedom has
its limitations. Bush is not allowing her to pressure Israel's
Prime Minister. The assumption that nothing will come of the
Olmert-Abbas bi-weekly meetings has brought convergence [a.k.a.
realignment] back into the picture.... How can Rice pay Olmert back
for his intransigence? Israeli experts see one weakness: talks on
increasing U.S. military assistance to Israel. Rice and her people
can stall the process bureaucratically to signal her displeasure.
It will be interesting to see whether they will do this, or respect
the presidential prohibition on pressuring Israel."

IV. "Strong Hand Needed"

Conservative columnist Yosef Harif wrote in the popular, pluralist
Maariv (3/28): "The Bush adinistration, which has so far adhered to
the Roadmap, does not entriely rule out the Saudi/Arab initiative
out of regional American interests. Some members of the
administration see it as a basis for negotiations between Israel and
the Arabs. Even some Israelis called to demonstrate a positive
approach toward that initiative. A scrutiny clarifies that only the
Palestinians tend to benefit from it and that the plan is entirely
bad for Israel. No Israeli government would have accepted the tough
demands included in the Saudi imitative. The prevalent spirit in
the Arab counties is that the Israeli Prime Minister is weak and
that he can therefore be pressured. Olmert will be able to earn
esteem if he proves that he is not weak, and if he strongly rejects
the plan."


V. "Family Feud"

Senior Middle East affairs analyst Zvi Bar'el wrote in Ha'aretz
(3/28): "[Due to disputes between Arab states], one could list all
the member countries [of the Arab League] and explain why, given
each option, Rice could meet with only ... four [in Aswan on
Saturday]. As a result, Rice, and anyone else waiting for the
outcome of the Riyadh summit, will apparently have to make do with
the 'ratification of the Saudi initiative.' No innovations, no
corrections, no updating.... But Saudi Arabia has another account to
settle with Israel and Washington, in the wake of February's Mecca
agreement. This led to the establishment of the Palestinian unity
government, which Israel does not recognize. The agreement was the
result of a Saudi effort, and now the Arab citizen is waiting to see
how Saudi Arabia will treat the agreement it birthed. Will it
succeed in breaking the siege against Palestine and thus in
annulling the Quartet's decisions? Or will it propose an alternate
deal: cooperation with the Palestinian government in return for a
resolute Arab stance on Iran and cooperation over Iraq?"

VI. "We Have Not Yet Said the Last Word"

Former Israeli negotiator Gilad Sher wrote in Ha'aretz (3/28): "The
[Israeli] government's position is right: The Palestinian government
is required to recognize Israel, respected signed agreements, and
cease terror. But that stance should not prevent dialogue.... In a
controlled, continuous, and real dialogue process with the moderate
Palestinians, headed by Abu Mazen, one can and must advance toward a
permanent solution -- two states for two nations.... At this time,
there is no logic in a total boycott stifling the Palestinians
because of Hamas's stance.... Only if those negotiations fail after
sincere, continuous efforts, the government of Israel will have to
protect its Jewish, Zionist, and democratic identity -- in
accordance with its own judgment."

JONES