UK Prime Minister Tony Blair on Monday invited Palestinian ministers to London in January, for a conference on Palestinian "reforms".
"
There's about as much chance of having significant reforms under Arafat as there are... under Saddam Hussein
"
Binyamin Netanyahu
Israeli Foreign Minister
But Binyamin Netanyahu said the talks would be futile as long as Yasser Arafat - not himself invited to the talks - was leader of the Palestinian Authority.
Mr Netanyahu, who is flying to London on Friday for a meeting with British Foreign Secretary Jack Straw, said there was no political room for reform under Mr Arafat's leadership.
Syria visit criticised
"I'd like to hear what Prime Minister Blair has in mind," Mr Netanyahu told a news conference in Rome.
"If he's talking about changing Palestinian politics, changing Palestinian economy, changing Palestinian education, that would be a welcome thing.
"But if he's entrusting this to Arafat there's about as much chance of having significant reforms in any of these areas under Arafat as there are... any significant reforms under Saddam Hussein."
Mr Netanyahu also criticised London for hosting Syrian President Bashar al-Assad earlier this week.
"To win the war on terror you need moral and political clarity and consistency," he said.
"For example I think it's a mistake to invite the leader of a terrorist state par excellence, like Bashar al-Assad, to European capitals because it sends a message that terror pays."
In September, Mr Arafat scheduled the first Palestinian general election since 1996 for January after coming under intense pressure at home and abroad to introduce sweeping democratic reforms.
Earlier this month, he said the 20 January ballot would have to be postponed unless Israeli forces withdrew from West Bank cities which they reoccupied after a wave of suicide bombings against Israelis.
Israel blames Mr Arafat for Palestinian militant attacks and refuses to negotiate with him.
'Road map'
The Palestinian Authority says its efforts to crack down on radical groups have been hindered by Israeli occupation and military attacks on its infrastructure.
The London talks will run parallel to efforts by the United States, the European Union, the United Nations and Russia to draw up a "road map" for peace in the region and lay the groundwork for a Palestinian state.
The British conference will be attended by Mr Blair and chaired by Foreign Secretary Mr Straw. Egypt, Saudi Arabia and Jordan have also been asked to send representatives.
Israel is not expected to attend the talks, and has asked the US to delay adoption of the so-called road map until after its own general elections in late January.