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The head of the Palestinian negotiating team, Ahmed Qureia, said on Saturday that if a joint Israeli-Palestinian statement is not formulated before the upcoming Middle East peace conference, the Palestinians may not participate in it.

Qureia, who is a former Palestinian Authority prime minister, told Saudi newpaper Al-Watan that the sides should agree before the summit - which Israeli officials say is set for November 26 - on a timetable for implementing agreements.

The former prime minister also said that the principles of a solution to the Israeli-Palestinian conflict are clear to both sides, and now they simply must be worded in a serious, unambiguous document.

Palestinian Authority Chairman Mahmoud Abbas said on Friday that the Israeli and Palestinian teams asked to draft the joint statement ahead of the Annapolis conference will hold their first meeting Monday.

Abbas said he expected at least 36 states to attend, including 12 Arab states, three Muslim nations, the permanent members of the UN Security Council and the G-8.

"We hope that the number will increase to 40 states," Abbas was quoted as telling Palestinian dignitaries from Jerusalem on Friday evening, during a meal breaking the dawn-to-dusk fast of the Muslim holy month of Ramadan.

The remarks were carried by the Palestinian news agency WAFA and confirmed by a participant.

Abbas did not provide a list of countries expected to attend. The U.S. has not released such a list.

In Friday's meeting, Abbas told his guests that a solution for Jerusalem would be key to any peace deal. "Jerusalem has always been in our hearts, and the hope that we have been looking at," Abbas was quoted as saying.

"There is no independent Palestinian state without Jerusalem as its capital. It is a concern in the coming, difficult days."

Abbas met with Prime Minister Ehud Olmert on Wednesday in Jerusalem to discuss the joint statement.

The statement may include references to the core issues of a final-status agreement on the establishment of a Palestinian state, but such references would be non-committal, and the statement will deal only with issues that enjoy clear agreement.

The parties differ greatly on the results they would like the conference to yield, with Abbas looking for agreement on core issues - Jerusalem, refugees and borders - while Olmert seeks a vague statement of interests.

Israeli officials said the statement would be "significant enough but general enough to avoid a blow-up and a crisis."

They also said "the parties understood there was no point to pledging that the statement would include agreement on core issues, but that if there were issues on which agreement could be be reached, they would be included in the statement."

"The stage at which the parties are at now is like a young couple that first moves in together," a Palestinian source told Haaretz. "It shows progress, and can lead to marriage, that is, to a peace agreement, but it might bring up all kinds of differences of opinions and lead to a painful break-up."

Senior Palestinian Authority officials said Olmert and Abbas' giving a green light to the negotiating teams to start work indicates headway, although no progress has been made on the permanent status issues.

U.S. Secretary of State Condoleezza Rice is to arrive in Israel and the Palestinian Authority on Monday to see if a joint statement can include the core issues. A government official said that as Rice worked over the past two weeks to persuade the Arab countries to join the summit, she realized that "success for the Arab countries would be only if the core issues were mentioned in one way or another in the joint statement."

Palestinian Foreign Minister Riad Malki reiterated statements by Abbas that participants at the summit would need to set a timetable to implement the agreement, and that within six months the Palestinians want to see formulation of the agreement completed. He added that Abbas would bring any agreement to a referendum.

An Israeli source said, "There was agreement at the meeting that it was not necessary to talk about timetables."

The source said the Palestinians understood progress should be made in keeping with the road map, "because among other things they are not prepared for the war on terror."

Bush says he is 'very optimistic' about Palestinian statehood prospectsU.S. President George W. Bush said in comments aired on Friday he was "very optimistic" a Palestinian state could be set up alongside Israel and that next month's Middle East conference could lead towards peace in the region.

"I am very optimistic that we can achieve a two-state solution," Bush said in comments on Al Arabiya television that were dubbed in Arabic.

"We will host the international peace conference and it will be attended by the interested parties and a delegation from the Arab League and it is an opportunity for serious... discussions over the road forward to lead to a two-state solution and efforts will be made to reach this objective," Bush said.

"I want to affirm that the two-state solution is part of a comprehensive peace in the Middle East and that our strategy is for all parties to attend at the table for the sake of a comprehensive peace. We want to push this issue," Bush continued.

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