US envoy George Mitchell was shuttling between Israel and the Palestinians for a second day on Friday to save Middle East peace talks threatened with collapse after only four weeks of direct negotiation.
Mitchell was meeting first with Israeli Prime Minister Benjamin Netanyahu in Jerusalem then with Palestinian President Mahmoud Abbas in the West Bank city of Ramallah.
"We are making efforts together with Senator Mitchell to continue to hold the talks with President Abbas," Netanyahu said. "We want the talks to continue and I want this. We have a mission of peace."
The European Union's top diplomat, Catherine Ashton, also met Netanyahu on Friday in an attempt to bridge the gaps between the sides.
Ashton said she had arrived especially from the US to show the European Union's commitment to the peace talks. She said the negotiations should lead to a solution of two states for two people by the end of the year
The EU foreign affairs chief urged Israel to continue the building freeze and called on the Palestinians not to quit the peace process.
Addressing the situation in Gaza, Ashton called on Israel to lift the blockade and vowed that the EU would continue supporting the peace negotiations.
Abbas says he will pull out of the talks unless Israel extends its freeze on new building in Jewish settlements in the occupied West Bank, which expired this week.
'I want this.' Mitchell (L) and Netanyahu (Photo: Amos Ben-Gershom, GPO)
Netanyahu is refusing to extend the construction moratorium and Israeli reports said he had rebuffed a US offer of "very generous" incentives to persuade him to extend it by 60 days.
US President Barack Obama has invested major political capital in a bid for a Middle East settlement within a year.
Israeli media suggested he was desperate to have Netanyahu agree to keep the talks alive by keeping settlement construction frozen, and was furious at being rebuffed.
An Israeli official, who requested anonymity, confirmed that "the White House made an offer of incentives to Israel as described in the media but these were rejected by Netanyahu".
Ynet reported that Obama never signed off on the offer. The security proposals were floated in a paper drawn up last week by Israeli Defense Minister Ehud Barak and White House Middle East aide Dennis Ross, it said. It would have become a "presidential letter" had Netanyahu accepted.
Obama succeeded in persuading Abbas to resume direct peace talks with Israel on Sept. 2 after a 20-month hiatus but with no overt guarantee from Netanyahu that the settlement freeze he ordered last November would be extended.
'Exerting every possible effort'Some Israeli political commentators expressed surprise the proposals had been rejected. But they said Netanyahu was afraid of losing power if he got too far out in front of his own governing coalition, which is dominated by pro-settler parties skeptical of peace deals, including his own right-wing Likud.
Close to half a million Jews live on territory where the Palestinians aim to establish a state with east Jerusalem as its capital.
Palestinians say the growth of the settlements, on land Israel has occupied since 1967, will render impossible the establishment of a Palestinian state in the West Bank and Gaza Strip -- the stated goal of the peace talks.
Netanyahu and Abbas both say direct talks should continue.
"We are exerting every possible effort in order to ensure that the senator succeeds in his mission in maintaining the direct negotiations," Palestinian chief negotiator Saeb Erekat told reporters in Ramallah on Thursday.
Abbas has said he will hold off on a decision on the fate of the talks until the Arab League can discuss the issue at a meeting in Cairo next week and reach a consensus.
The meeting of the League's committee on the peace process had been scheduled for Monday Oct. 4 but Egypt - a close US ally - has asked its partners to postpone the discussion until a meeting on Oct. 8, giving Mitchell more time to bridge the negotiating gap.
Attila Somfalvi and The Associated Press contributed to the report
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