Well if Jerusalem is divided anyways by the Jewish region and the Arab region, then the jurisdiction of those areas should be held in each sovereign country's control. But to have a barrier across the city wouldn't be so great. Does a border have to exist or do you just have the specific areas under the jurisdiction of either Israeli Government or Palestinian Government? Look at Monaco and France, different countries and no barriers. But maybe for this option, you need total cession of conflict and mutual respect, etc. Not like Berlin or border between North Korea and South Korea. I understand that the Palestinian Parliament is the same distance from the Old City. Right? Then the Capital is a somewhat shared capital with coexistence and shared economic responsibility by both given the reality on the ground. How else do you do it? I don't think there's really another scenerio to this, living with tolerance and respect of each others' histories, aside from continued conflict.
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from the article: ANALYSIS / Meshal declaration basic shift in Hamas position