Israeli Intelligence Said to View PLO as a Talks Partner

An intelligence report delivered to top Israeli Cabinet ministers last week singles out the Palestine Liberation Organization as the most viable partner for talks to end the Arab uprising, Israeli sources said Monday.

The report, an annual intelligence estimate, also warns that unless a solution is found, the unrest in the occupied West Bank and Gaza Strip could go on for years.

The estimate, the sources said, was a combined effort of Israel’s intelligence institutions--Mossad, the foreign intelligence agency; Shin Bet, the domestic intelligence agency, and the armed forces intelligence service.

It has come to light at an especially sensitive time, when Prime Minister Yitzhak Shamir is trying to convince Washington that local Arabs independent of the PLO are the only acceptable partners for peace talks.

Last week, U.S. Secretary of State James A. Baker III said that Israel may someday be impelled to talk with the PLO. But the Shamir government has steadfastly refused to open contacts with the PLO--because of continuing Palestinian guerrilla activity and because the PLO wants to establish a Palestinian state next to Israel.

Eliahu Ben-Eliezer, a member of Shamir’s Likud Party, told Israel Television that “anyone in the security establishment who thinks Israel cannot prevail in the uprising should be forbidden to serve.”

Michael Eitan, a Likud member of Parliament, attributed the press leak to Finance Minister Shimon Peres, who heads the Labor Party and is a longtime rival of Shamir.

The portions that have appeared in the local press deal only with the PLO and the intifada , as the Arab uprising is called, which is now in its 16th month.

According to the newspaper Haaretz, the report says that “a real change has occurred in the PLO, with aspirations of finding a political solution.” And according to Haaretz, it goes on to say: “There is no leadership in the (West Bank and Gaza) territories not directed by the PLO.”

Other sources said the report predicts that Washington will try to persuade Israel eventually to talk with the PLO. Under one plan, local Palestinians would negotiate with Israel about short-term arrangements for peace, such as elections and the pullback of Israel’s army, and the PLO would get involved in final talks dealing with sovereignty and borders.

The report reportedly describes the PLO as having joined the “moderate” Arab bloc that includes Jordan and Egypt. It warns that if peace efforts fail, Jordan, Egypt, Iraq and Yemen--four countries that recently joined to form the Arab Cooperation Council for economic development--could combine into a hostile “eastern front” for military action against Israel.

The analysis echoes comments made last summer by Maj. Gen. Amnon Shahak, the head of Israeli military intelligence. Shahak said there was no real alternative to PLO leadership.

The estimate undermines several of Shamir’s arguments against talking with the PLO. It challenges his contention that the true leaders of the intifada are exclusively local and divorced from the PLO. And by taking the position that the PLO has undergone “real” change, it runs counter to Shamir’s assertion that the PLO is irredeemably wed to terror.

The report was submitted to the government’s 12-member policy-setting Inner Cabinet last Wednesday, although it was completed in December. One source said Shamir’s office has ordered a counter-report to show that the PLO is engaged in terrorism.

Shamir is scheduled to visit Washington early in April and to unveil a long-awaited peace plan.

Monday night, in remarks before opening a conference with more than 1,000 Jewish leaders from around the world, Shamir said, “We fully recognize that the status quo is not in our interest, because it means the absence of peace, and peace is our paramount goal.”