Israel, Palestinians Finalize Peace Plan With Help of U.S. : Diplomacy: Barak and Arafat reach agreement on land and prisoner issues and will sign pact today. Both sides resolve to forge a permanent settlement within a year.

With a diplomatic push from the United States, the Israelis and Palestinians late Friday announced agreement on a long-stalled peace plan that gives land and prisoners to the Palestinians and sets a one-year target date for permanent settlement of their decades-old conflict.

The agreement--an expanded version of last fall’s U.S.-brokered Wye Plantation accord--will be signed tonight in an Egyptian resort on the Red Sea, Israeli and Palestinian officials said.

The breakthrough came after Secretary of State Madeleine Albright spent the day shuttling between Israeli Prime Minister Ehud Barak and Palestinian Authority President Yasser Arafat.

Israel and the Palestinians “have really seized a historic opportunity and will tackle issues that will define their peace for generations to come,” Albright said.

After conferring with Albright here in his Gaza City offices, Arafat telephoned Barak to say he was ready to sign. Barak in turn pledged to “open together a new era of confidence and partnership,” a spokeswoman for the Israeli prime minister said.

Announcement of the deal ended a dizzying week of last-minute theatrics and brinkmanship, brought to a close only by the presence of American mediation. The two sides had hit an impasse over the release of Palestinian prisoners and other details.

It is Barak’s first international accord since he came to power two months ago, riding a landslide election victory and high hopes that he could revive a Middle Eastern peace process that had ground to a halt under the three-year hard-line rule of former Prime Minister Benjamin Netanyahu.

Of particular significance, the new component of Friday’s agreement calls for the two sides to draft by Feb. 15 a “framework,” or guideline, for settling the most difficult outstanding issues they face. Negotiators would then seek to resolve those so-called “final-status” issues by September 2000. They include the fate of 3 million Palestinian refugees, the status of the disputed holy city of Jerusalem, water rights and final borders.

“We hope that this will usher in a new era for peace and real success in implementing all the agreements that have been signed so far,” Nabil Shaath, a senior Palestinian negotiator and official in Arafat’s government, said of the agreement. “It is a good step forward.”

Under the deal, Barak promises to release 350 Palestinian prisoners held for anti-Israeli activities--50 fewer than demanded by Arafat--and to withdraw troops from an additional 11% of the West Bank in three phases to be completed by Jan. 20. Israeli state radio said the first batch of 200 prisoners and the initial transfer of 7% of the West Bank could begin as early as Sunday.

The overall timing of the agreement, which runs into January, had troubled Arafat, sources said, because he believed it gave Barak leverage to link the last troop pullback to progress in the talks aimed at drafting the final-status framework.

Shaath said Albright gave the Palestinians formal U.S. “guarantees” that Israel would complete the land transfers regardless of what happens with the final-status negotiations. A senior U.S. official denied that the Palestinians had received specific guarantees but said the U.S. position on fulfillment of the agreement’s terms was made clear to both sides.

Palestinian Statehood Issue Slowed Talks

A final hitch surfaced when Israel sought specific language that would prevent Arafat from unilaterally declaring a Palestinian state, one the few cards Arafat has to play. But instead of the specific ban, intentionally vague language against unilateral actions, taken from the original Wye accord, was incorporated in the new agreement, the U.S. official said.

The Palestinians were demanding freedom for 400 Palestinian prisoners in Israeli jails, men whom the Palestinians see as freedom fighters in their struggle against Israel but whom many Israelis see as terrorists.

Shaath said the Palestinians finally accepted the lower figure of 350 because it came with a promise that a “significant number” of additional prisoners will be released in December for the Muslim holidays of Ramadan. There was no immediate Israeli confirmation of the promise.

Arafat told confidants as recently as Wednesday that failure to free the prisoners amounted to his political suicide. After the signing last fall of the Wye accord, which called for the release of 750 prisoners, Israel released 250 people. But most were common criminals rather than militants, and the outrage that followed triggered weeks of deadly riots.

Throughout the day Friday, as negotiators inched toward agreement, several dozen Palestinian men and women held a vigil to protest the continued detention of their sons, brothers and fathers. Gathered under a tent in East Jerusalem, they vented their anger in equal portions at the Israelis and at Palestinian leaders, who they feared would sell out their cause.

Sumayah Issa, a thin woman in her 50s, said her son, Nasser, has spent the last decade in a prison in the Israeli coastal city of Ashkelon for killing a Palestinian collaborator. He was 16 at the time of the slaying.

“Our sons did what they were ordered to do,” said Issa, a mother of five who lives in the Arab neighborhood of Shufat, five miles north of Jerusalem. “Everyone has blood on their hands, even the Palestinians with whom the Israelis are sitting and negotiating.”

The demonstrators marched to the nearby U.S. Consulate and delivered a letter addressed to Albright, pleading for her help in freeing their relatives.

Albright was forced to step back into a familiar role as mediator despite Barak’s insistence that he wanted U.S. officials to keep their distance. It was the Palestinians who most wanted an activist American intervention, and by staging repeated crises, artificial or not, they got their way.

Albright Says She Served as ‘Facilitator’

Albright spent most of the day Friday trying to dot the last I’s and cross the last T’s on the deal. After three hours of talks with Barak that ended at 3:40 a.m. Friday, she traveled to the Palestinian Authority’s Gaza Strip headquarters Friday night for a working dinner with Arafat.

U.S. officials said Albright was engaged in classic shuttle diplomacy, carrying messages and tentative deals between the parties. Nevertheless, Albright insisted that Washington’s role was much more limited than it was during the Netanyahu tenure when U.S. officials wrote the pacts and pressured Israel and the Palestinians to go along.

“I was there basically in the role of facilitator,” she said. “Perhaps I should not introduce a new term into all this, but maybe I was just the handmaiden.”

Publicly, Albright and her aides remained cautious through most of Friday, but there was growing optimism that the agreement was finally, after many false starts, done.

Once the deal was sealed, Albright said she contacted President Clinton and Egyptian President Hosni Mubarak. The signing ceremony is set for Sharm el Sheik about 11 o’clock local time tonight, officials said, because the Israelis could not attend until after the end of the Sabbath.

In addition to land transfers, prisoners and the final-status arrangements, the agreement picks up elements of the original Wye accord, which was signed last October by Netanyahu, Arafat and Clinton, who took an extraordinarily activist role. Netanyahu froze implementation of the original accord a few weeks after it was signed, accusing the Palestinians of failing to comply.

Items picked up from the original accord include the construction of a harbor in the Gaza Strip and the opening of safe passage for Palestinians between Gaza and the West Bank. The Palestinians commit to several security measures, including the confiscation of illegal firearms and the arrest of terrorism suspects.

Arafat may take heat from the Palestinians for failing to free more prisoners, and Barak will be criticized by conservatives in Israel. The Likud Party issued a statement Friday night saying Barak had “failed miserably” by making too many concessions to the Palestinians.

At this stage, though, Barak’s coalition government holds a large majority in parliament and is not vulnerable to the kind of political threat that Netanyahu faced when he signed the original Wye accord. Within weeks, his government lost a vote of confidence in parliament, forcing the elections that brought Barak to power.

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Wilkinson reported from Jerusalem and Kempster from Gaza City.

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Implementing the Peace Deal

Israel said it would begin implementing its new peace deal with the Palestinians within 10 days, probably on the Sept. 13 anniversary of the landmark Oslo peace accords signed by Israel and the PLO in 1993. It includes these steps:

* Transfer of 7% of the West Bank to self-rule.

* Release of 200 Palestinian prisoners, followed by a second release of 150 in October.

* Troop redeployments on Nov. 15 and Jan. 20.

* A one-year target date for negotiating a final peace treaty, with a preliminary “framework agreement” scheduled to be ready by Feb. 15.

* Opening of safe routes across Israel for Palestinians to travel between the West Bank and Gaza.

* Construction of a seaport in the Gaza Strip, a vital economic lifeline for the Palestinians.

Source: Reuters