Har Homa lays foundations for new violence

"I own land near here and I think that if the Israelis build a settlement at Har Homa they will confiscate it as well," said Emily Richmawi, an elderly Palestinian woman, as she clutched her banner during a demonstration below the pine- covered hill in south Jerusalem where Israel plans to build a settlement for 26,000 Jews.

Israeli riflemen in purple berets lay spreadeagled on the rocks overlooking the road down which 1,000 Palestinians were trying to reach Har Homa. Mrs Richmawi explained that her life had got worse since the Oslo agreement was signed. Not only had confiscations continued, but "we even need a permit to get into Jerusalem".

Despite Palestinian anger over Har Homa, known to Palestinians as Jabal Abu Ghneim, Yasser Arafat, the Palestinian leader, was clearly eager yesterday to avoid violence. Middle-aged men in green and white baseball caps, members of the Palestinian Preventive Security Service, mingled with the crowd, pushing back anybody who looked like a potential stone-thrower.

There may not be many more peaceful demonstrations at Har Homa. "People don't think they can stop the settlement being built," said Osama Zarour, a Canadian Palestinian, as he watched the rally with his two-and-a-half- year-old daughter, Yasmin, perched on his shoulders. "But once the bulldozers start moving there will be trouble. We have to do something. Getting publicity isn't enough."

For the moment, publicity is what Mr Arafat is after. Benjamin Netanyahu, the Israeli Prime Minister, has lost much of the international credibility he gained after he agreed to a partial Israeli withdrawal from Hebron in January. The Palestinian leader received a notably sympathetic reception during his four-day visit to the US.

Har Homa is overshadowing the decision by the Israeli cabinet yesterday to withdraw from a further 9 per cent of the West Bank. Agreement was reached after a prolonged session in the early hours of yesterday morning by a vote of 10 to seven ministers. The most important change is that 7 per cent of so-called area "B", where Israel has security control, but Palestinians have civilian authority will join area "A", where Palestinians have total control. There will be two more withdrawals by the middle of next year.

The West Bank will remain a jigsaw puzzle with Palestinians in control of the towns, but not of their hinterland. Israeli troops will leave villages like Halhoul with a population of 25,000 north of Hebron. But the areas of Palestinian control remain cantons which Israeli forces can easily isolate. More than a million West Bank Palestinians cannot visit their main population and commercial centre which is East Jerusalem.

In persuading the cabinet to support him yesterday Mr Netanyahu is reported to have said: "The Americans are pressuring me. We have no choice." As a result, part of the extreme right opposed to Oslo blames the US for what it sees as a retreat from the dream of the Land of Israel stretching from the Mediterranean to the Jordan. A sign of this anger was a fierce clash this week between Martin Indyk, the US ambassador, who is Jewish, and Rehavam Zaevi, a member of the Knesset and leader of the far-right party Moledet.

The argument began when Mr Zaevi called Mr Indyk "a kike" (Canadian slang for a Jew) two weeks ago. Mr Indyk complained and at a ceremony this week went up to Mr Zaevi and said: "The last time somebody called me a kike was when I was a 15-year-old and I punched him in the face." To this Mr Zaevi said: "Well try it. Let's see you. You're a kike." Mr Indyk said: "You're a disgrace to your people." Mr Zaevi said: "You're a son of a bitch."

The US is annoyed with Mr Netanyahu over Har Homa and his announcement that four Palestinian offices are to be closed in Jerusalem. Nahum Barnea, the Israeli columnist, says the US views the closure of the offices as "proof of Netanyahu's chronic weakness - to stray from essential matters and consummate his addiction for public relations stunts." In this case, one of the offices to be closed as part of Mr Arafat's Palestinian Authority - the Islamic Committee for the Struggle Against Settlements - turns out not to be an office but a filing cabinet. The committee has not met for eight months.

Mr Netanyahu says if he is squeezed too hard by the right he will form a National Unity government with Labour. This could happen. The Prime Minister does not have to stand for re-election for three-and-a-half years. But his popularity is low. An opinion poll shows that at present he would get 21 per cent of the vote if he stood against the most likely candidates. But Labour is itself deeply divided and still led by Shimon Peres, defeated Mr Netanyahu last year.