It sets the scene for a signing ceremony in Washington today which brings peace in Palestine one step closer.
By the middle of next year Yasser Arafat, chairman of the PLO, will probably be based in the Palestinian town of Ramallah, 15 minutes' drive from the centre of Jerusalem.
He will be the directly elected head of a Palestinian executive which will rule an entity on the West Bank and Gaza which will be very close to an independent state.
It is an extraordinary achievement for a man whom some of the toughest politicians in the Middle East, such as Ariel Sharon of Israel and President Hafez al-Assad of Syria have tried to destroy physically or politically. Often belittled and usually underestimated, Mr Arafat has survived crushing military defeats in Jordan in 1970 and Lebanon in 1982 to win at least a measure of self-determination for his people.
Critics of the Oslo agreement of 1993 say that Mr Arafat is more a Buthelezi than a Mandela and that his autonomous enclaves are closer to "Bantustans" than an independent state. A spokesman for the Hamas Islamic organisation said this week that on the West Bank Israel would continue to control "90 per cent of the security, 70 per cent of the land and 50 per cent of the water".
Certainly the areas of self-rule will look strange on the map. There will be 800,000 Palestinians crushed together in Gaza as well as seven cities and towns on the West Bank over which Mr Arafat and the 82-member Palestinian Council will have civil, police and military control. In 450 villages Israel will retain, at first, military control, which will be gradually handed over to the council at six-month intervals.
Mr Arafat evidently calculates that his real power will be greater than it looks. He argues that, as with the PLO in Lebanon in the 1970s, his military and political power will be greater than his territorial base because he has the support of a politically active population. Even possession of the town of Jericho as a base for Palestinian security over the past year has already changed the balance of power on the West Bank.
The analogy with Lebanon is a dangerous one. There Mr Arafat faced only rag-tag militia armies. On the West Bank next year the Israeli army will be trying to prevent its overall security control being eroded. Palestinians are fearful that they will rule a series of "mini-Gazas", each of which could be sealed off and economically crippled by a few Israeli roadblocks.
The weakness of the present agreement is that it is very dependent on goodwill on both sides. The 400-page document, which is to be signed today by Mr Arafat and Yitzhak Rabin, the Israeli Prime Minister, sets out how two authorities, one Israeli and one Palestinian, will co-operate on the West Bank. Were Mr Rabin to lose the election next year to the right-wing Likud, this co-operation might end and the result could be a political explosion.
Other dangers are that, while many Palestinians will benefit from an Israeli withdrawal, others in Palestinian refugee camps and the wider Palestinian diaspora will not. If Israel seals off cities such as Nablus, Jenin and Hebron, which depend on their agricultural hinterland, the Palestinians of the West Bank will see their standard of living deteriorate. At this point Palestinians in general might decide that the Oslo agreement was bringing them very little.
For the moment, however, there are tangible benefits for Palestinians. Some 1,300 prisoners will be released today and a similar number when the Palestinian Council is elected. Mr Arafat's appearance in Washington to sign the accord gives legitimacy to Palestinian self-determination. A base in Gaza and the West Bank means that the Palestinian leadership is no longer at the mercy of Arab states such as Iraq, Syria or Libya.
It is all very fragile: Jerusalem, settlements, borders and refugees remain to be discussed. Distrust of Mr Arafat is deep among Israelis, say polls, but the majority want to go on negotiating because they cannot think what else to do. After the last Palestinian-Israeli peace agreement was signed in Washington in 1993, the pace of political developments was determined first by the consequences of the Hebron massacre, carried out by a Jewish settler, and then by the suicide bombs of Islamic militants.
That the second stage of the Oslo agreement has gone ahead despite these setbacks means that its opponents on both sides lack the political strength to stop it and after today it will have become irreversible.
n The Israelis said that the release of a first wave of more than 1,000 Palestinian prisoners, which is due to start today under the autonomy deal with the PLO, would take several days, AFP reports.
The cabinet has agreed to allow between 2,100 and 2,400 Palestinians to go free.
THREE STEPS TO PEACE
1 The Oslo agreement of 1993 set the framework for granting self- rule to Palestinians in phases, starting with Gaza and Jericho. Israel recognised the PLO as the representative of the Palestinians. Negotiations on difficult issues, such as the final status of Jerusalem and the 140,000 Jewish settlers, were postponed until 1996. External borders remain under Israeli control.
2 The extension of self-rule to the West Bank, which is to be signed today in Washington, is known in Israel as Oslo 2. Israel cedes military, police and civil powers in six cities and also partially withdraws from Hebron. It gives up only police and civil powers in 450 Palestinian towns and villages but will ultimately give up military power there as well. The Israeli army holds 70 per cent of the land including all settlements, military installations and uncultivated land.
3 Final status negotiations are to start by May, 1996. Under discussion will be the future of Jerusalem, refugees, settlements and frontiers. These talks will take place as Palestinians elect an 82-member Palestinian Council and an executive head. There will also be a phased release of prisoners under Oslo 2.Reuse content