Cliffhanger Israeli vote expected

Mr Barak desperately needs a peace deal

By BBC News Online's Kathryn Westcott

The withdrawal of Binyamin Netanyahu from Israel's leadership race is likely to produce a tight contest between Prime Minister Ehud Barak and the hard-line opposition leader Ariel Sharon.

Polls suggested that Mr Netanyahu, a former prime minister, was the clear front-runner in February's vote.

Mr Netanyahu (left) says he will not challenge Mr Sharon

But the same polls do not show a similar lead for Mr Sharon, his heir as Likud party leader.

They suggest Israel is in for a hard fought campaign and a cliffhanger election.

Political observers say the prime minister desperately needs some momentum from the Middle East peace process if he is to beat Mr Sharon, the leader of the Likud party.

Divided

For a few days, it looked like a three-way race was shaping up, involving the former Labour leader Shimon Peres.

Mr Peres, who had previously been prime minister twice but never won a national election, tried to enter the race as an independent candidate, but failed to win over the support of the left-wing Meretz party.

For Prime Minister Barak, the prospect of Mr Peres running was a frightening one, because he threatened to split the left-of-centre vote.

The mood in Israel is for separation from the Palestinians

Dr Rosemary Hollis, head of the Middle East programme at the Royal Institute of International Affairs in London, says that the values Mr Peres represents would not have gone down well in the election had he stood.

Dr Hollis says Mr Peres is associated with a vision of peace that includes integration with the Arabs, whereas the mood in Israel now is for separation.

'Fudge'

Daphna Vardi, correspondent for one of Israel's leading daily newspapers, Maariv, says it is impossible to predict which way the election will go.

Israel's right-wing blame Mr Barak for making too many concessions

"The outcome of talks between the Israelis and the Palestinians could determine the outcome of the election," Ms Vardi says.

"But if there is a dramatic terrorist attack in the near future, there will be a big swing to the right."

A series of Palestinian suicide bombings was partly responsible for Mr Netanyahu's victory in 1996.

Ms Vardi predicts that the best that can be accomplished at the latest round of negotiations in Washington is what she describes as a "fudge".

"I don't think Mr Barak will be able to take a compromise on Jerusalem to the country and win a referendum," Ms Vardi says.