Bush faces uphill struggle on Mid-East

He has faced a chorus of disapproval from allies since he called for a new Palestinian leadership while outlining his long-awaited policy on the region two days ago.

But late on Tuesday, Mr Bush restated his belief that Yassser Arafat must be replaced as he arrived in Calgary for the two-day summit.

The Palestinian Authority has now announced that a presidential election will be held in mid-January.

A number of G8 countries have expressed opposition to interfering in Palestinian leadership issues.

The BBC's Jon Leyne says that while the other leaders will politely welcome evidence of growing American involvement in the peace process, they would like to see the US put more pressure on Israel to make concessions to the Palestinians.

In his comments on Tuesday night, Mr Bush defended Israel's latest incursions into Palestinian controlled areas of the West Bank as part of its military campaign against Palestinian militants.

"Everybody's got a right to defend themselves, but all parties must work towards peace," Mr Bush said.

He added: "What Palestinians need is leadership - elected leadership. They need a constitution."

West Bank offensive

Israel has maintained its grip over West Bank towns, placing at least 700,000 Palestinians under curfew in an offensive which Palestinian leader Yasser Arafat has described as a "premeditated assault against the Palestinian people and its leadership".

Israeli forces are now holding seven of the main Palestinian population centres - Hebron, Jenin, Nablus, Qalqilya, Tulare, Bethlehem and Ramallah.

Mr Arafat has accused Israel of trying to topple his regime and retake the West Bank while "justifying their actions by falsely describing them as attacks against terror".

The Israeli military has banned reporters from all the cities and towns under its control, drawing a protest from the Foreign Press Association.

The new crackdown was launched in the wake of a recent spate of suicide attacks on Jerusalem which killed 26 Israelis.

Arafat's promises

Mr Arafat has brushed aside Mr Bush's comments, saying that it is up to the Palestinian people alone to choose their leader.

Insisting that he himself had been democratically elected, Mr Arafat pledged to pursue reforms and to hold elections early next year.

Correspondents say Mr Arafat is trying to put a brave face on Mr Bush's speech on Monday, in which the US president backed Palestinian statehood but appeared to endorse the tough line of the Israeli Government.

The BBC's Jeremy Cooke says that for Israeli Prime Minister Ariel Sharon, Mr Bush's speech was a political victory on a scale he could not have imagined.

He adds that it is now clear that Mr Bush shares Mr Sharon's view that the Palestinian leader is irrelevant and must be replaced in order for there to be political progress.

But, our correspondent says, in attacking Mr Arafat, the US president risks damaging the chances of alternative leaders as ordinary Palestinians may view them as puppets of Israel and the US.