Arabs, Israel Hold 1st Talks; U.S. Calls It a Breakthrough : Mideast: Madrid session with Palestinians ends with promise to continue ‘good, businesslike’ approach. Israelis and Syrians report no progress.

After a cantankerous day of disputes that threatened to leave both sides in the lurch, Israel sat down Sunday to its first direct talks with its Arab adversaries, meetings that U.S. officials termed a breakthrough in the search for peace in the Middle East.

Israelis and Palestinians met for nearly five hours, emerging with a promise to continue the “good, businesslike” talks as soon as a location can be worked out.

Syria, after intercessions from several Arab leaders and Soviet President Mikhail S. Gorbachev, dropped its demands for more assurances on the future of the talks and went into session with Israeli delegates shortly after 10 p.m. The session ended more than five hours later, shortly after 3 a.m.

The Israelis said afterward that the atmosphere was chilly in the talks with the Syrians and that no agreements were reached. There was no understanding on future meetings or on how the two sides would communicate in the meantime.

Israeli delegates met at midafternoon with a negotiating team from Lebanon, which had delayed its final acceptance until Syria gave the go-ahead.

“There have been, and as I have said before there will be, obstacles in the process to be overcome, but they have not deterred us until now, and they do not diminish the importance of what we have done,” Secretary of State James A. Baker III said as the first round of talks was under way.

But none of the parties has agreed to a location for continuing the negotiations, and Baker said he could make no assurances about when Round 2 would begin. “There can’t be any guarantees,” he said. “This is the Middle East.”

Both the United States and the Soviet Union have pledged to stay involved in the process, especially to ensure that the parties can agree on a venue. Israel has insisted on moving the talks to the Middle East, arguing that the conflict can never be resolved without bringing the solution home. The Arabs have refused, arguing for the talks to remain in Madrid or in some other neutral location.

Baker said he is prepared to “make proposals” for a venue if the parties cannot agree, though he did not say what locations the United States might suggest. Sources close to the talks say Washington and Williamsburg, Va., are the two most likely candidates.

Syria reportedly has said it will not consider talks in Washington unless the United States agrees to resume its dialogue with the Palestine Liberation Organization and to remove Syria from its official list of countries supporting terrorism. But the PLO said it would welcome talks in the U.S. capital, or in Moscow, which is co-sponsoring the talks.

Clearly elated after their first face-to-face bargaining session with Israel as part of a joint delegation with Jordan, Palestinian leaders said they discussed procedures for the next talks and also pressed their demands for a halt to the building of Jewish settlements in the Israeli-occupied West Bank and Gaza Strip. They also urged the Israelis to ease conditions on members of the delegation living in the territories, protecting them from arbitrary arrest or censorship.

The Israelis conceded that talks over self-government for the Palestinians would be directed mainly to committees in which Palestinians would play the lead role. This would leave the discussions over peace treaties to the Jordanians. In effect, this raised the status of the Palestinian delegation, which Israel had tried to keep in a junior position to the Jordanians.

“I’m very glad the first bilaterals have started today in a very positive manner,” said Hanan Ashrawi, official spokeswoman for the 14-member Palestinian delegation. Ashrawi predicted that the next round of talks could begin within the next two or three weeks.

Israeli officials were also upbeat, calling the commencement of the direct negotiations “a welcome day for Israel.”

“For 43 years, we have sought peace with our neighbors, and we’ve known during all that time that the best way, the only way to achieve that is to hold direct, bilateral talks,” said Israel’s deputy foreign minister, Benjamin Netanyahu.

“We now have an Israel that is ringed with a circle of talks, and we hope that it will replace the circle of guns that surround us,” he said.

It was a day of fits and starts, with both the Syrians and the Israelis holding out for maximum tactical advantage before finally sitting down to the long-awaited meetings.

Israeli delegates waited more than half an hour Sunday morning for a Syrian delegation which had already announced it wasn’t showing up at that hour; the Syrians later in the day got taken off to the wrong palace by Spanish security forces who hadn’t been alerted to a last-minute change in location--all after a long night of haggling that left most of the delegates exhausted before the day even began.

The procedural wrangling threatened to split the Arab camp even before the talks started. Sharp differences emerged between the Palestinians, who were eager to begin the talks as soon as possible, and Syria, which had reportedly urged the Palestinians, Jordanians and Lebanese to hold out for guarantees that the talks would conclude in an acceptable location before sitting down at the table.

“We wouldn’t have wanted to leave them out,” PLO executive committee member Nabil Shaath, officially excluded from the talks but monitoring them from a downtown hotel, said of the Syrians’ fears that the Palestinians would go to the table without the rest of the Arabs. “But we want solutions, not just tendentious pronouncements.”

A Palestinian adviser to the talks said the Palestinians argued to both Syria and Jordan, which was initially inclined to back Syria, that Palestinians are most directly affected by the Israeli occupation and most in need of proceeding to the peace table immediately.

Syria from the beginning has been uneasy about the progress of the conference in Madrid. Though it had lost its initial argument to convene a truly international conference under the auspices of the United Nations, Syria had at least hoped to keep the parties talking as a group in Madrid for some period of time, rather than repairing directly to some other city for face-to-face talks with Israel behind closed doors.

The Syrians regard Israel’s bid to move the talks out of Madrid and back to the Middle East as a breach of the agreement that brought the parties to Spain in the first place. The Arabs also resist any attempts by Israel to effectively normalize relations without first making concessions.

Israel says moving the talks to Jerusalem and various Arab capitals is the only way to assure that the Arabs are serious about peace.

By late on the eve of Sunday’s talks, Syria had agreed to attend, under one of two conditions: either that the talks between Israel and the Palestinian-Jordanian, Lebanese and Syrian delegations all be held in the same place, at different times, or at the same time, in different places.

Previously, the talks had been scheduled in three different venues spread throughout Madrid, and Israelis showed up at 10 a.m. for the previously scheduled meeting with the Syrians, claiming they didn’t know the meeting had been rescheduled for 2 p.m.

Sources close to the Syrian delegation said it had intended to meet the 2 p.m. schedule, but was mistakenly taken to the wrong location by Spanish security authorities, who hadn’t been informed of the change in plans.

Baker held separate half-hour meetings with the Israeli delegates and the Palestinian-Jordanian delegation to help clear up the mess. He also met with Alexander Belonogov, the Soviet deputy foreign minister.

In an aside while taping an interview with NBC’s “Meet the Press,” Baker declared: “God, it’s incredible what they can argue about.”

Indeed, major questions remained about how the parties would ever come to agreement on where, and when, to meet again, in the wake of Baker’s departure shortly after midnight Sunday.

But Baker said the United States plans to leave a full team of advisers on hand to help direct the progress of the talks, including the State Department’s top Middle East expert, Edward P. Djerejian.

“We intend to stay fully engaged, as fully engaged as we can and for as long as we think the parties are serious about peace. And for the moment, I think they are serious,” Baker said.

A State Department official said later that U.S. officials would remain in touch with all of the parties--relaying messages if necessary--until the next face-to-face meeting is scheduled.

Baker had strong positive comments about the Israeli meetings with the joint Palestinian-Jordanian team, which met for about 2 1/2 hours in the morning, broke for lunch, and then resumed for another 2 1/2 hours in the afternoon.

“They surely intend to proceed in a serious and constructive fashion, and that gives us reason to believe that we really are entering a new phase in the Middle East,” Baker said. “I have no reason to think that any country is on the verge of pulling out of the process, just because we have a continuing difference of opinion as to what the venue is going to be for the bilateral negotiations. I think if that was going to be the case, we would have seen it before now.”

The Israelis, after several days of contentiousness in the ceremonial opening phase of the talks, were also unexpectedly upbeat about the opening of the bilaterals.

In comments after the meeting, the Israelis dropped many of the defensive themes they expressed in recent days, including charges that the Palestinians are bent on driving Israel to the suburbs of Tel Aviv, if not into the sea. “The fact that negotiations took place is a sign of goodwill,” said Elyakim Rubinstein, a senior assistant of Prime Minister Yitzhak Shamir and head of the Israeli team.

A senior Israeli official added that “it was clear that the Palestinians want very much to continue” the talks. No one among the Israelis would say how the two sides would keep up their discussions once they leave Madrid. The Israelis asked for a phone number from the Palestinians, but the Palestinians declined to give one, a Foreign Ministry official said.

There was little good or businesslike in the talks with Syria, at least from the Israeli point of view. The long Israeli-Syrian session ended with disagreement on every point brought up.

Unlike their meetings with the other delegations, the Israelis immediately brought up a long list of issues of substance. They demanded an end to armed attacks by Palestinians from Syria or from Lebanese territory controlled by Syria, called on Syria to accept the signing of a peace treaty as the object of negotiations, and to agree to hold talks on arms control, regional water-sharing arrangements and the environment.

There was no agreement on where to hold subsequent meetings and no accord on how they would communicate in the meantime, the Israelis said.

Yosef Ben-Aharon, the chief Israeli negotiator and a member of Prime Minister Yitzhak Shamir’s inner circle, said Syria brought up the Golan Heights as the sole subject of the talks.

“They would not discuss any issue but one--territory,” said Ben-Aharon. “They said that before anything else was discussed, we would have to withdraw.”

Ben-Aharon said he was not surprised by the Syrian position. “It remains for us to find some method to continue,” he said, but he rejected suggestions that the Untied States would have to mediate between the two hostile nations.

Times staff writer Norman Kempster contributed to this report.

Peace Talks at a Glance

Here’s what happened concerning the Middle East peace talks on Sunday, the first day of face-to-face negotiations: * GOOD START: Israelis and Palestinian-Jordanian negotiators held their first direct formal talks, saying in a joint statement that they were conducted “in a good, businesslike atmosphere.” Although they failed to set a new date or place for the next such talks, the two sides said they will try to move on to more substantive issues such as Palestinian autonomy within a few days.

* SYRIA RELENTS: Despite its earlier heated criticism of the Israelis, Syria held its bilateral meeting with Israel late Sunday night. The Israelis said afterward that the atmosphere was chilly and that no agreements were reached.

* BAKER PLEASED: Secretary of State James A. Baker III, whose eight months of shuttle diplomacy brought about the peace conference, said he was “especially pleased with the quality” of the Israeli-Palestinian meeting.

* PLO ENCOURAGED: The Palestine Liberation Organization said it was heartened by plans for future talks with Israel.

* GOING HOME: Tens of thousands of mostly Shiite Muslim villagers began returning to their homes in southern Lebanon, a day after an Israeli-backed militia reportedly ordered them to leave.