Shimon Peres, the Israeli Foreign Minister, held two hours of talks with Yasser Arafat, chairman of the Palestine Liberation Organisation, at Mr Arafat's headquarters in the Gaza Strip. It was the first time Mr Peres had visited Mr Arafat in Gaza.
Nabil Shaath, the senior Palestinian negotiator, said before the meeting that if nothing new emerged, "we are talking about a crisis because the peace process is now at a standstill".
Mr Peres and Mr Arafat later emerged with nothing new to say about when or how self-rule would be implemented in the West Bank. The next stage of the peace process is already nearly six months behind schedule.
It is not, however, the delay alone that is spreading disillusion. Palestinians have severe doubts about whether Israel has any serious intention of implementing self-rule in the West Bank. Road. Building in the settlements has been stepped up in recent months.
According to the agreement, autonomy in the West Bank would begin with the redeployment of Israeli forces away from Arab population centres "on the eve" of Palestinian elections. However, on the grounds that Mr Arafat has failed to implement self-rule inGaza to Israel's satisfaction, Israel wants him to accept that elections take place in some Palestinian towns with Israeli forces still present.
Some Palestinian leaders have suggested that Mr Arafat may be forced to accept these terms. However, by making such a great concession, he would be playing into the hands of his main opponent, Hamas, the Islamic Resistance Movement.
To assure the world that the talks are still on track, Mr Arafat and Mr Peres yesterday avoided using the word "failure", saying the issue would be taken up by high-level committees and that there might soon be a meeting between Mr Arafat and Yitzhak Rabin, the Israeli Prime Minister.
n Riyadh - Saudi Arabia's highest religious figure, Sheikh Abdel Aziz ibn Baz, said for the first time yesterday that peace was possible between Arabs and Israelis because it was not against the teachings of Islam, AFP reports.