U.S., PLO Move Toward Accord on Talks, Clinton Says : Mideast: In bid to restart negotiations, Washington may back demand for peacekeepers in occupied lands.

The United States and the Palestine Liberation Organization are inching toward an agreement that could restart the stalled Middle East peace process, possibly by deploying an international force to protect Palestinian civilians in the Israeli-occupied West Bank and Gaza Strip, President Clinton said Friday.

“I believe we have some more movement in the Middle East,” Clinton told a White House news conference. “We are continuing to inch ahead.”

Clinton was asked about an assertion by a PLO official, Nabil Shaath, that the U.N. Security Council is nearing agreement--with U.S. support--on a proposal to send armed peacekeepers to the occupied territories in response to the massacre of 48 Palestinians in a Hebron mosque last week.

“I’m encouraged in a way by what he said, but I wouldn’t overstate it,” Clinton replied.

American support for dispatching U.N. troops could touch off a bitter dispute between the United States and Israel, its closest ally in the Middle East, a controversy that would also have domestic political ramifications because of Israel’s strong support on Capitol Hill.

Israeli Prime Minister Yitzhak Rabin said this week that his government will never accept an outside military force in the West Bank and Gaza Strip, although he indicated that he might approve some sort of token civilian presence.

The President did not reveal details of the negotiations. But his remarks seemed to go beyond the careful assessment of Secretary of State Warren Christopher, who said earlier this week that Washington would support an international military presence in the West Bank and Gaza Strip only if both Israel and the PLO wanted it.

Shaath spoke to reporters after a 50-minute meeting with Christopher and U.S. Middle East specialists.

The PLO official, a key adviser to Chairman Yasser Arafat, came to Washington hoping to persuade the United States to endorse PLO conditions for restarting negotiations on limited Palestinian self-government in Gaza and the West Bank town of Jericho.

Besides U.N. peacekeepers, the PLO wants Israel to dismantle some Jewish settlements in the occupied territories and to disarm settlers.

So far, Israel has rejected all of the demands.

The PLO broke off negotiations with Israel after a settler sprayed the Ibrahim Mosque in Hebron with automatic-weapons fire.

Palestinian anger at the massacre has been directed as much at Arafat as at Israel. Furious Palestinian civilians claim that Arafat made the killing possible by joining peace talks with Israel.

Although the logic of that position is dubious, Clinton said earlier this week that Arafat needs political cover before he can rejoin the talks.

Israeli Foreign Minister Shimon Peres agreed that Arafat must have something to show his followers before he can be expected to resume negotiations.

Ultimately, the PLO may settle for a symbolic victory.

A U.N. Security Council resolution authorizing peacekeepers may be enough, even if the troops are never sent.

That circumstance appears likely, given that an international force would not be deployed without Israel’s approval.

Shaath said after his meeting with Christopher, “We are satisfied that we have the serious concerns of the United States reflected by the secretary and State Department people and the President.”

Referring to the Security Council resolution that the PLO seeks, Shaath said no decisions have been made yet on the makeup of a peacekeeping force. But he said the presence must be more than a few civilian observers.

“They have to be security people,” he said. “We are not talking about historians and psychoanalysts.”

Also Friday, the State Department said it is discussing with the Justice Department possible new curbs on private organizations, including American Jewish groups, that back extremists abroad. Much of the funding for Kach, the militant Israeli organization of which Hebron killer Baruch Goldstein was a member, comes from American donations.

“We’re reviewing options under existing laws as well as considering whether new laws or new regulations would be appropriate . . . to deal with this issue,” department spokeswoman Christine Shelly said.