Israel and PLO all set for historic peace deal

ISRAEL and the Palestine Liberation Organisation are ready to sign this morning the historic agreement to mark the beginning of the end of Israel's 27-year occupation of the Gaza strip and West Bank, and the start of Palestinian self-rule.

'The negotiations are over,' Nabil Shaath, the PLO negotiator, said early today. 'Everything is agreed, the signing is going to be in hours.'

Israel's Prime Minister, Yitzhak Rabin, and the PLO chairman, Yasser Arafat, had met late into the night at Cairo's Presidential Palace to thrash out a number of outstanding issues. Words are now to be translated into reality, with Israel saying it could complete withdrawal from Gaza and Jericho within three weeks.

Dignitaries from around the world were converging on the Egyptian capital yesterday for today's lavish signing ceremony, with more than 2,000 guests expected, including foreign ministers from 40 nations. The signing ceremony has been billed by the Egyptians as 'a Madrid mark II', a reference to the 1991 Madrid conference which launched the current peace process.

Since the Oslo accords were signed in Washington in September, laying the groundwork for today's expected agreement, both sides had been locked in seemingly intractable negotiations, missing December's original deadline for signing an accord on the Gaza strip and Jericho.

The agreement will make all sides acutely aware of the obstacles which lie ahead. Extremists on both sides remain capable of destabilising the fledgling Palestinian entity. The danger from some Jewish settlers was brought home to all after February's Hebron massacre which temporarily halted negotiations.

A grim and exhausted-looking Mr Rabin yesterday made clear he expected Mr Arafat to take strong action against militants in his camp. 'Any failure of the Palestinian police force to prevent terrorist attacks could throw the deal into question,' he said.

Mr Arafat played the game of brinkmanship to the end yesterday, keeping the Israelis guessing about his intentions by delaying his arrival in Cairo. Before his meeting with Mr Rabin, he said a number of points remained to be decided. Disagreements centred on the final size of the Jericho enclave, the presence of a Palestinian policeman at the bridge crossing from Jordan, the nature of the international presence, and the number of Palestinian prisoners to be released.

Palestinian sources said another cause of the delay was a dispute over whether Mr Arafat should be named president or chairman of the interim authority which will hold power before full Palestinian elections, due in July. On arrival in Cairo, however, the PLO leader said there was no dispute, and turned his comments into a joke by referring to himself as the rais - an Arabic word which means both president and chairman.

Many of the security arrangements for the new Palestinian entity of Gaza and Jericho were agreed in an earlier accord in February. Despite last night's difficulties, the terms of this final agreement were already clear in outline. Palestinians in the Gaza-Jericho areas will take over the running of all internal affairs, while Israel maintains responsibility for Jewish settlements.

A 300-page document is believed to have been drawn up to cover the powers and jurisdiction of the 9,000- strong Palestinian police force. It has been agreed that the Palestinian police will have authority only over Palestinians in the self-rule areas, and no Israeli citizens can be brought before Palestinian courts even if they commit crimes in the Gaza-Jericho areas.

Israel has insisted on the right to send troops into the self-rule areas when it believes its security is being threatened. According to one draft, it has also been agreed that no explosives can be held by Palestinians inside Gaza and Jericho.

The interim authority will have limited powers to pass laws and annul existing Israeli military orders. However, according to a draft, Israel will maintain a right of veto over such legal changes through a joint Israeli- Palestinian committee.

Mr Arafat has fought hard for many symbols of statehood, winning the right to have Palestinian stamps and a dialling code, but there will be no Palestinian currency.

If he is to win mass Palestinian support for the Gaza-Jericho deal, he must be able to sell it as a first step towards statehood.

dollars 1.2bn aid for Palestinians, page 11

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