US warns Israel on settlements

There are some 150 settlements in the Palestinian territories

Washington has told Israel that developing Jewish settlements in the Palestinian territories goes against the peace plan known as the roadmap.

"A freeze is a freeze," said state department spokesman Richard Boucher after reports of a tender for new Israeli homes in the Gaza Strip.

Mr Boucher said talks were under way on the issue after news of the tender drew Palestinian condemnation.

The dispute follows the failure of talks on the latest stage of Israel's military withdrawal from the territories.

The talks on Wednesday marked the first official contact between Israel and the Palestinian Authority since President George W Bush met their leaders in Washington in a bid to kick-start the peace process.

The issuing of this tender proves that Sharon [intends] to dig the state of Israel deeper into the West Bank and the Gaza Strip Peace Now

Mr Boucher said talks were under way to make sure there was a "common understanding" on what a freeze on settlements meant.

"It remains a stated US policy that a settlements freeze is part of the roadmap and we expect the parties to abide by the commitments in the roadmap," he said in Washington.

He added that there were "very involved aspects" to the issue such as "so-called natural growth".

'Dangerous step'

The tender approved by the Israeli defence ministry offers rights to build 22 new housing units in the settlement of Neveh Dekalim, one of scores across the Palestinian territories.

ROADMAP MAIN POINTS Phase 1 (to May 2003): End to Palestinian violence; Palestinian political reform; Israeli withdrawal and freeze on settlement expansion; Palestinian elections Phase 2: (June-Dec 2003) Creation of an independent Palestinian state; international conference and international monitoring of compliance with roadmap Phase 3 (2004-2005): Second international conference; permanent status agreement and end of conflict; agreement on final borders, Jerusalem, refugees and settlements; Arab states to agree to peace deals with Israel

The Israeli Government argues that existing settlements should be allowed "natural growth" within their boundaries.

The Neveh Dekalim tender is the first issuing for a Gaza Strip settlement in more than a year, Israel's Haaretz newspaper reports.

Condemnation of the tender came both from inside Israel and the Palestinians.

Peace Now, the Israeli group which opposes settlements built on land seized in the 1967 Middle East war, said:

"The issuing of this tender proves that Sharon has no intention to withdraw from the territories but instead to dig the state of Israel deeper into the West Bank and the Gaza Strip."

Palestinian legislator Saeb Erekat described the tender as a "big challenge to everything the peace process built".

"Israel still insists on destroying the road map because they choose the settlements over the peace," he said.

Withdrawal talks fail

According to officials at Wednesday night's talks in Jerusalem, disagreement centred on which two towns should next be vacated by Israeli troops.

What is the security fence?

Palestinian security chief Mohammed Dahlan had sought Israel's withdrawal from Ramallah, where Mr Arafat has been marooned for more than a year by Israeli forces.

But Israeli Defence Minister Shaul Mofaz would only agree to withdraw from Jericho and Qalqilya.

Jericho has been largely bypassed by nearly three years of violence and its handover would be seen as a formality.

Qalqilya, however, is at the edge of the West Bank, just a few kilometres from the Israeli city of Kfar Saba.

Hundreds of demonstrators protested in the town on Thursday against a controversial security fence being built by Israel.

The talks breakdown clouded the first high-level talks since the Israeli and Palestinian prime ministers paid separate visits to Washington over the past seven days to discuss the US-backed roadmap peace plan.