Fear of descent into fresh bloodshed as leaders return home empty handed

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The Middle East must now brace itself for fresh violence after the failure of the Palestinians and Israelis to achieve a settlement at the Camp David talks.

The Middle East must now brace itself for fresh violence after the failure of the Palestinians and Israelis to achieve a settlement at the Camp David talks.

Yasser Arafat will face intense pressure to go ahead with his pledge to declare a Palestinian state on 13 September, regardless of the impasse on key issues that prevented a deal at the summit.

Fears abound on both sides that, if efforts fail by the United States to breathe life into the ashes of the negotiations, the region will descend into a fresh round of bloodshed. Shortly before the summit, Israel warned that it would respond to a unilateral declaration of a Palestinian state by annexing Jewish settlements, home to 180,000 Israelis, on the occupied West Bank and Gaza Strip. If this happens, clashes between Palestinians and the Israeli military seem certain.

The latter has repeatedly warned of the risk of violence. Although this was partly to raise the stakes in the talks, the army has already taken concrete measures, sending armoured vehicles to protect Jewish settlers in the Gaza Strip and increasing patrols and surveillance at the Temple Mount in Jerusalem's Old City - scene of deadly clashes between Muslims and Jews.

There had been signs that the summit was inching towards a deal. But both sides emerged empty handed. Israel has not won the international recognition of its borders or its capital that it has craved for so long. Nor has it won a declaration from Mr Arafat that the conflict is finally over, ending the flow of blood spilled in the name of Israeli Zionism and Palestinian nationalism.

For now, ordinary Israelis must go on living on edge, wrapping their huge security blanket even tighter around themselves. And so it will remain, until the two sides feel ready to resume negotiations.

Next time, it will be harder; the already dismal relationship between Mr Arafat and Ehud Barak will only have deteriorated in the last fortnight.

Mr Barak returns to Jerusalem knowing that he has failed in his mission to be Israel's Prime Minister of peace, despite the withdrawal of his troops from south Lebanon. The chances are that he will now be able to rebuild a broad coalition government, which collapsed on the eve of the summit. But the country's sizeable peace lobby will be bitterly disappointed.

Mr Barak will surely now say that he stuck courageously by his "red lines" - particularly by defending Israel's claim to sovereignty over an undivided Jerusalem - in the face of an inflexible Mr Arafat.

There will be celebrations among the more fanatical elements among Jewish settlers, who were churning out leaflets accusing Mr Barak of betraying Jerusalem. But Israel's right-wing will not applaud for long. One of its stalwarts, Moshe Arens, a former defence minister, yesterday warned that the country's interests have been "severely prejudiced". "The many concessions [Mr Barak] was prepared to make at Camp David have set down a marker," he wrote in Ha'aretz newspaper.

The picture for Mr Arafat is scarcely better. In the short term, he will be praised for failing to cave in to the demands of Israel, and for defending the Muslim world's aspirations for Arab sovereignty over Islamic holy sites in Jerusalem. The summit's failure enables Mr Arafat - whose popular support has been dwindling - to claim to have stood up to Israel, like Hizbollah in Lebanon and the late Hafez al-Assad in Syria.

Unrealistic though everyone knows they are, Palestinian aspirations - for a full Israeli withdrawal to the June 1967 borders; for right of return and compensation for 3.5 million refugees, for a capital in east Jerusalem - formally remain intact.

Last night the militant Islamic Palestinian group Hamas sought to make political mileage from the summit's failure by calling on Mr Arafat to return to the armed struggle against Israel.

Frustration on the streets of the West Bank and Gaza has been simmering dangerously for months. Palestinians are fed up with hearing promises of peace, but getting nothing. And they are fed up with the fat-cat bureaucrats from their own Palestinian Authority and its security services enriching themselves while crushing dissent. If Mr Arafat unilaterally declares a Palestinian state in September, the pent-up despair could easily turn to violence.

But the long-term picture was never anything but dark for the Palestinians. The most they could ever get from the peace "process" begun in Oslo seven years ago is a fractured, demilitarised state, living in the permanent shadow of Israel and infected by corruption and disillusion even before it was born.