Crunch time for Mid-East peace

West Bank refugees: A key focus of the summit talks

US President Bill Clinton has urged compromise by both sides ahead of the make-or-break summit meeting between the Israeli and Palestinian leaders aimed at achieving a lasting peace.

"The two leaders face profound and wrenching questions and there can be no success without principled compromise," Mr Clinton said in Washington before departing for Camp David.

The road to peace as always is a two-way street

Bill Clinton

The leaders are gathering at the presidential mountain retreat outside Washington made famous when Egypt and Israel secured a breakthrough peace deal there in 1978.

President Clinton - who will chair talks between Israeli Prime Minister Ehud Barak and Palestinian leader Yasser Arafat - said there was no guarantee of success, but not to try would be a guarantee of failure.

President Clinton, who has less than seven months left in office, is expected to spend much of the next week mediating between the two sides.

The thorniest issues will be on the agenda, including the status of Jerusalem, the establishment of a Palestinian state, the fate of Palestinian refugees and the future of Jewish settlements.

Clinton's goal

It is seen as the last chance for President Clinton to go down in history as a Middle East peacemaker.

But Mr Barak and Mr Arafat are also playing for high stakes, and the outlook is grim if they fail to secure an agreement by the 13 September deadline.

Summit's core issues

Borders and powers of a Palestinian state

Status and sovereignty of Jerusalem

Fate of over four million Palestinian refugees

Future of 170,000 Jewish settlers in West Bank and Gaza

Mr Arafat could carry out his threat to declare a Palestinian state, possible as early as 13 September, and Israel could respond by annexing West Bank land where Jewish settlements are located.

"It's going to be a difficult process, but the fact that they're coming means that we've still got a chance," the US president said.

"They have come because they think that the price of not doing it is greater than the risk of going forward."

But he said both leaders had "the vision, the knowledge, the experience and the ability and sheer guts" to reach a deal.

Barak under pressure

Mr Barak, still under enormous political pressure at home, arrived at Camp David a day after scraping through a no-confidence vote in parliament.

Ehud Barak: Laying down Israeli requirements

If an agreement is reached, Mr Barak will take it to a referendum in Israel, or he might choose to make it the main issue of fresh elections.

The BBC Jerusalem correspondent Hilary Andersson says that either way, he is under pressure to dig his heels in on the key issues, so that he can sell any deal to his people.

Mr Barak said before departing for the US: "The choice is between a peace of the brave and a violent conflict that will make new victims and that will not resolve any problem."

But he added: "There will not be peace at any price".

Struggle for Jerusalem

Jerusalem, he said, would remain undivided and under Israeli sovereignty - a flat rejection of the Palestinian goal of establishing east Jerusalem as the capital of a Palestinian state.

Yasser Arafat has promised to declare a Palestinian state

He said the 1967 borders would have to be modified and settlers in the West Bank and Gaza Strip would remain in blocs under Israeli sovereignty.

And Mr Barak said the solution to the question of four million Palestinian refugees would "not be found on sovereign Israeli territory".

Hanan Ashrawi, a spokeswoman for Mr Arafat's delegation, warned the Palestinians would not bend from demands for a full Israeli withdrawal to the 1967 borders, the return of all refugees and a Palestinian capital in Jerusalem.

"We will not agree to any partial agreements, if Barak wants to end the conflict this is the way to do it."

Each side will be allowed a 12-member delegation inside Camp David, where a strict news blackout will be in force.