In an interview with the Independent, the King spoke with intense bitterness about Jordan's isolation by the world - and particularly its Arab neighbours - following his stance, seen as pro- Iraqi, in the Gulf war. However, he said, Jordan was now holding its head higher than ever before, knowing it had no choice but to take the course it did.
Celebrating the 40th anniversary of his accession to the throne yesterday, the King was at his most buoyant, promoting Jordan's role in the Middle East as the standard-bearer of democracy, which he said he hoped other Arab states would follow.
On the peace process, King Hussein was more positive than other Arab leaders have been about concessions by the new Israeli Prime Minister, Yitzhak Rabin. He was 'optimistic' about the future, saying Israelis had voted for a just and durable peace, and that Mr Rabin's concession on settlements in the West Bank were a 'welcome beginning'. However, the King is not ready to meet Mr Rabin: 'I don't know if I will ever go to Jerusalem again,' he said with a wistful smile, thinking perhaps of the Dome of the Rock in Jerusalem - he is paying for its restoration.
For King Hussein, the accelerating peace process raises the highly sensitive question of confederation. As the practicalities of Palestinian self-rule are discussed, speculation has mounted over the King's intentions towards the West Bank, which Jordan ruled until Israel seized it in 1967.
One model partnership discussed in Jordan is the co-existence of Jordan and Palestine, both ruled by a supreme federal parliament and with the King at its head. Some Palestinians fear they might jeopardise their fight for independence if they are closely linked to Jordan, while others believe Jordanian ties are essential for survival.
The King's early offers, in the 1970s, of Jordanian-Palestinian unity were roundly rejected when, in 1974, the Arab League declared the Palestine Liberation Organisation the sole representative of the Palestinian people. Then, in 1988, as a result of the Palestinian intifada, the King severed links with the West Bank. Indicating a strong desire for new trust, describing the people of the east and west banks as 'all one family', the King said: 'My attitude to the West Bank has always been one of great concern, as for Gaza. We are closer to the people of Palestine than anyone in the entire world.'
But he stressed that Palestinians had made abundantly clear 'that they want to have their say about their future on their soil'. He said: 'I want to say categorically, I am not going to discuss confederation, or any other form of relationship now; it is for the people to decide under conditions of freedom at a time of their choosing in the future.' He would not confirm that by this he meant the issue would have to be put to a referendum in both countries, although this is the PLO position.
The King is being forced to tread carefully, not only because of Palestinian sensitivities but because of opposition to his support of the peace process within Jordan, particularly from the Islamic movement, which made strong gains in recent elections.
Commenting on the threat from Islamic extremists, he said: 'Anyone would be disturbed at some of the images of Islam. To see Islam as a way to achieve power - as something which it isn't - disturbs me very deeply. It is an ignorance, a frustration with so much that has gone on in the region.'
Assessing Jordan's standing in the Arab world and in relation to the West after the Gulf war, King Hussein said the country had emerged 'more than ever with its head held high as far as the people are concerned'. But he is critical of the splintering of the Arab world after the Gulf war, revealing that wounds are far from healed with Saudi Arabia and Egypt. 'On the other hand, people of Jordan are proud, knowing there was no other course. Our concern was not for the leadership of Iraq, but for the suffering of its people,' he said. Jordan had since suffered a lot, with the 10-12 per cent increase in population with the new inflow of Palestinians from Kuwait and the Gulf states. Economically, the country had been treated 'only relatively better' than Iraq in terms of its isolation.
King Hussein fiercely rejected claims that Jordan had been allowing breaches of United Nations trade sanctions against Iraq: 'We are implementing resolutions and we will not permit anybody to put in question our desire to do so, or to see Jordan as a suspect.
The King declined to give his assessment of Saddam Hussein's continuing strength, saying he had not had contact with the Iraqi leader since the fighting. He suggested - without much conviction - that Iraq might learn from Jordan's lesson in democracy. Jordan is speeding up its democratic changes with a decision to legalise political parties. 'I hope I will be able to see in what remains of life the consolidation of democratic decision-making.'
With a side-swipe at Arab neighbours, he said: 'When we speak about democracy, some people feel uncomfortable. When we speak about press freedom, some people feel uncomfortable. When we speak about human rights, some people feel uncomfortable. But I believe it is the only way. And I hope we can be an example to others.'