World news: Victory for settlers in Jerusalem tussle

The Jewish settlers who, backed by an American millionaire, are attempting to establish themselves in a Palestinian part of Jerusalem, have reached agreement with the Israeli government on their future. But, writes Patrick Cockburn, what is being presented as a compromise deal is really a total victory.

The American millionaire Irving Moskowitz has won a near- total victory in his attempt to establish a new Jewish neighbourhood in the previously Palestinian district of Ras al-Amoud in east Jerusalem. Under a "compromise", the present 11 Jewish settlers will be replaced by 10 seminary students who will guard and renovate the largest villa they have occupied.

In effect, Benjamin Netanyahu, the Israeli Prime Minister, has changed the status quo in east Jerusalem - the balance between Muslims and Jews - something which earlier in the week he had promised not to do. Going by past experience, Palestinian anger will lead to violence, probably in the form of suicide bombs.

Yasser Arafat, the Palestinian leader, yesterday called the "compromise" a trick, but appears interested primarily in milking the issue for as much diplomatic advantage as he can, by preventing violent demonstrations on the streets. He also wants to show Madeleine Albright, the US Secretary of State, that the threat to the peace process comes from Mr Netanyahu and not himself.

The Israeli Prime Minister said the agreement was the best possible for "the unity of Jerusalem, the unity of the nation, and the continuation of the peace process."

Apart from stone-throwing at Israeli troops by boys in Hebron yesterday there was little violence after Palestinian Muslims held Friday prayers.

Israeli security says it has charged two members of Hamas, the Islamic militant organisation, with planning to kidnap Ehud Olmert, the right- wing Mayor of Jerusalem, and explode a bomb in the city's largest mall.

The deal whereby the Israeli government has effectively given its sanction to the settlement at Ras al-Amoud was agreed by Avigdor Kahalani, the Internal Security Minister.

But it emerged in the Israeli press that Dr Moskowitz had given $1m (pounds 600,000), a lot of money in Israeli politics, to fund a lobbying group opposed to Israel returning the Golan Heights to Syria, which became the nucleus of Mr Kahalani's party, the Third Way.

The settlers claim that by establishing the beginnings of a new Jewish settlement at Ras al-Amoud they have completed a ring around Jerusalem which breaks up the continuity of the Palestinian districts in the city. They say their intention is to make it impossible for Paestinians to have their own capital based in east Jerusalem.