A group of Palestinian entrepreneurs yesterday presented plans to create a new Palestinian city in the West Bank, located between Ramallah and Nablus.

The group, headed by businessman Abd al-Malik Jabbar, presented its plan to Israeli, Palestinian and U.S. officials during an economic conference at the home of the U.S. Ambassador to Israel, Richard Jones.

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According to sources who were at the Herzliya event, the idea was received with enthusiasm by the attendees, including Defense Minister Amir Peretz. The Palestinian Authority has already allocated land for the new city.

The Israelis attending the conference also included Deputy Defense Minister Ephraim Sneh and senior ministry officials Amos Gilad, Haggai Alon, Eitan Dangot, Michael Herzog and Yosef Mishlav.

The Palestinian delegation included the PA's chief negotiator, Saeb Erekat, and two senior advisers to PA Chairman Mahmoud Abbas. Jones was joined by the U.S. security coordinator for Israel and the PA, Keith Dayton, among others.

According to Palestinian sources, the developers want to build the city in Area A, which is under the PA's full control.

They see the new community as comprising several thousand housing units containing 140 to 200 square meters of floor space apiece. It will be meant mainly for young, middle-class families.

The sources said that in addition to easing the housing crunch for West Bank Palestinians, the project would provide thousands of construction jobs, both for the homes and for the small businesses the city expects to support.

Jabbar's plan calls for subsidizing home prices with the help of funding from U.S. charities and wealthy Arab states.

'Not Israel's business'

Israeli military officials who spoke to Haaretz about the plan said it was first put forward about a year ago. "It's not any of Israel's business if the Palestinians want to build a city on their territory," said one.

However, implementing the plan will require Israeli military cooperation over the supply of raw materials and travel permits for the workers.

According to one Palestinian participant at the conference, "the Israeli response implies that the Defense Ministry won't torpedo the plans."

The conference participants agreed to create an Israeli-Palestinian economic committee that will meet every two weeks to discuss agricultural issues, trade and infrastructure, among other topics.