Sharon sees Palestinian state at end of peace process

Sharon and Bush met at the White House Thursday evening.

WASHINGTON (CNN) -- Israeli Prime Minister Ariel Sharon said Thursday the Middle East peace process will ultimately result in a Palestinian state.

"At the end of the process, I believe we will see a Palestinian state," Sharon told reporters after meeting with President Bush at the White House.

"But only at the end," he said. "The final steps that should be taken in order to start negotiations, this cannot be done under terror."

Both Sharon and Bush said Palestinian leader Yasser Arafat was holding up the peace process by not stopping terrorist attacks.

"I assured the prime minister that we will continue to keep pressure on Mr. Arafat to convince him that he must take serious, concrete, real steps to reduce terrorist activity in the Middle East," said Bush.

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The U.S. leader said Arafat's statements that he was working for peace appeared hollow after a weapons-laden ship -- "that most of the world believes he was involved with" -- was intercepted by Israel in January.

Sharon said Arafat has "chosen a strategy of terror."

"Myself and my government regard Arafat as an obstacle to peace," Sharon said. "We believe that pressure should be put upon Arafat in order --- I hope -- to have alternative leadership in the future."

Bush also voiced concern about Palestinians who "aren't involved in terror."

"I'm deeply concerned about the plight of the average Palestinian, the moms and dads who are trying to raise their children, to educate their children," Bush said. "I've got $300 million in the budget to go through NGOs (non-governmental organizations) to help Palestinians be able to realize a better life."

After their hour-long meeting in the Oval Office, the two leaders took questions from reporters, including one on Vice President Dick Cheney's trip to the Middle East. Cheney will visit Israel and eight Arab countries in mid-March. Half of those Arab countries share a border with Iraq.

Bush said he was sending Cheney to the region because he was "a key player in our administration" and because he wants feedback from world leaders.

"I want them to see firsthand, as well, our strong intent to fight terror. There's nothing like looking somebody in the eye and letting them know that when we say we're going to fight terror, we mean it," Bush said.

"The vice president, I think, is going to be very effective at convincing our friends we mean business," Bush said. "We would hope that they would do everything in their power to shut off money, to deny haven (to terrorists), and to join this grand coalition dedicated to one thing: freedom and peace."

Israelis retaliate for attack

Relations between Israel and the Palestinians, never cordial, have steadily deteriorated since early December, when Palestinian suicide bombings occurred in Haifa and Jerusalem. Israel retaliated with attacks and the January 14 killing of Raed al-Karmi, a top member of Arafat's Fatah party. That has been followed by a series of Palestinian suicide bombings, and more Israeli attacks.

Karmi had claimed responsibility for the deaths of two Tel Aviv restaurant owners a year ago. Israel, which had placed Karmi on its list of most-wanted suspects, also blamed him for the deaths of eight other Israelis.

And, last month, Israel intercepted a ship carrying 50 tons of weapons, apparently en route from Iran to the Palestinian territories. Arafat denied any involvement in the incident, but fired a top Palestinian official and issued arrest warrants for two others.

Even as Sharon was en route to the Washington meeting, Israel was retaliating for a Wednesday attack in which a Palestinian dressed in an Israeli army uniform entered the Jewish West Bank settlement of Hamra and killed three Israelis before being killed himself.

Israel launched a missile strike early Thursday on a Palestinian target in Nablus, not far from the settlement. Later Thursday, Israeli helicopter gunships reportedly fired missiles at another Nablus building. There were no immediate reports of injuries.

Israeli forces Friday entered into the West Bank village of Tamoun near Nablus, Israeli army sources said. Palestinian sources with the Nablus governor's office said Israeli troops were searching houses in Nablus inside Area A, a section of the West Bank under full Palestinian control.

Israeli Radio reported that militant Islamic groups Hamas and the Al Aqsa Martyrs Brigades had claimed responsibility for the attack in Hamra. The Al Aqsa Martyrs Brigade is the military wing of Palestinian leader Yasser Arafat's Fatah movement.

Israel has blamed the Palestinians for timing the latest violence to coincide with Sharon's trip.

The visit marks the fourth time in a year Sharon has met with Bush. Arafat has not been invited to meet with the U.S. president.

Israel has posted tanks just yards from Arafat's headquarters in Ramallah and has effectively confined him to the West Bank for several weeks.

In a meeting Monday with Palestinian legislative council speaker Ahmad Qorei, U.S. Secretary of State Colin Powell reiterated Washington's message that Arafat has a responsibility to reduce violence and terror.