Arafat discusses peace talks with Egypt's Mubarak

JERUSALEM (Reuters) -- Palestinian President Yasser Arafat met Egyptian President Hosni Mubarak on Saturday for talks focused on peace negotiations with Israel and the future of Jerusalem.

"As usual it was an important visit in which we discussed the efforts of President Mubarak and the many attempts and the contacts he is conducting to push the peace process forward," Arafat told reporters on his return to Gaza.

Mubarak said before the meeting that Jerusalem was the most serious issue and "there has to be a fair solution."

Israeli sources said Arafat had rejected an Egyptian suggestion of shared sovereignty over some of the city's holiest sites.

On his return to Gaza, Arafat again criticized Israeli "intransigence" over Jerusalem at the U.S.-sponsored Camp David peace talks which collapsed last month.

"I say and repeat that Jerusalem is not just an Arab issue, is not only a Palestinian issue but is an Arab, Palestinian and Christian issue," he said.

Israel captured East Jerusalem in the 1967 Middle East war and regards the entire city as its "united and undivided capital," a status that is not recognized internationally.

Palestinians want the eastern sector as the capital of a future Palestinian state that they plan to declare as early as September 13. The two sides have set a mid-September deadline for reaching a final status agreement.

"There are several views, ideas and alternatives that are raised which open the door to reaching the framework for an agreement between the Israelis and the Palestinians but all of them are far from Israeli sovereignty over the sacred places," Egyptian Information Minister Safwat Sherif quoted Mubarak as saying before the meeting with Arafat.

Mubarak said Egypt would give the Palestinians advice but would resist pressure from other parties to influence them.

Sources in the office of Israeli Prime Minister Ehud Barak said Arafat had rejected an Egyptian suggestion for shared sovereignty over the sacred Temple Mount complex.

They said Israel had not discussed the possibility because Arafat had shown no flexibility on the issue.

The site, known in Arabic as al-Haram al-Sharif, is revered by Jews as the site of the biblical temples and by Moslems as the site of the al-Aqsa and Dome of the Rock mosques.

Palestinian cabinet minister Yasser Abed Rabbo who also travelled to Alexandria, said in Gaza that there were "no specific Egyptian formulas" and that "Egypt does not want to replace us in the negotiations or present compromise solutions."

"We explained to the Egyptians that the radical and high-minded Israeli position is responsible for obstructing progress and is leading to the failure of America's efforts to break the deadlock," Abed Rabbo told Reuters.

U.S. President Bill Clinton is due to conclude his current African tour by meeting Mubarak in Cairo on Tuesday for talks on the Middle East.

Playing down expectations for the meeting, he said there were "continuing difficulties" plaguing the peace process.

Arafat plans to visit Spain on Sunday, as part of a tour aimed at drumming up support for his position which has already taken him to several European, Arab and Moslem countries.

He is due to fly to Morocco on August 28 to attend a meeting of foreign ministers from 15 Moslem countries and the Palestinian Authority to again discuss the fate of Jerusalem.

Arafat is scheduled to meet Clinton at the U.N. Millennium summit in New York on September 6, for the first time since the Camp David talks.

"I will ask him to come and raise the American flag over the American embassy in holy Jerusalem, the capital of the state of Palestine," Arafat said.

Clinton was quoted earlier this month in an Arab newspaper as saying that he hopes to open an American embassy in the capital of a Palestinian state if Israeli-Palestinian peace talks are concluded by the end of the year.

Barak's office said in a statement that the Israeli leader had spoken over the weekend with Clinton and French President Jacques Chirac and had presented them with Israel's position on the peace process.

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