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At the end of her Middle East tour, U.S. Secretary of State Condoleezza Rice announced that Prime Minister Ehud Olmert and Palestinian Authority Chairman Mahmoud Abbas (Abu Mazen) agreed to "informal talks" about the nature of a future Palestinian state.

In a conversation with U.S. reporters who traveled with her, Rice said talks in the current climate are much more likely to reach an Israeli-Palestinian agreement than was the case in the 2000 Camp David talks, due to political changes on both sides.

Rice also called on the sides not to stall on the first phase of the road map and to discuss the broader issues. She mentioned talks on security arrangements and the nature of the democratic institutions in the Palestinian state.

Rice plans to return to the region in early February to meet with Olmert and Abbas, and the U.S. is currently looking for a neutral site to host the tripartite meeting without mandating a fourth participant. It is therefore unlikely the summit will take place in Egypt or Jordan.

At this stage, no invitation has been extended to Olmert and Abbas to come to Washington. Key Olmert aides, chief of staff Yoram Turbowicz and political adviser Shalom Turjeman, will meet in the coming weeks with their Palestinian counterparts, Rafiq Husseini and Saeb Erekat, to create an agenda for the summit.

Rice said in the Thursday press briefing in London: "I am very pleased with what we have achieved so far ... obviously the beginning of informal talks between Israel and the Palestinians will be a very positive development and the regional states welcomed it and will be willing to help the Israelis and the Palestinians in accelerating progress on the road map."

According to Rice, the informal talks were Abbas' idea. "I thought it was a very good idea. Prime Minister Olmert thought it was a good idea," she said.

Rice believes the talks will help build confidence between the sides after six years without negotiations, and she agrees with Abbas that presenting a "political horizon" will ease implementation of measures like removing roadblocks, easing movement and money transfers.

Rice was asked why she is optimistic, when Olmert and Abbas are weak politically compared to their predecessors. "Let's look at where it really was in 2000, all right? You had Yasser Arafat, who I think now had one foot in terror and one foot in politics. I would submit to you we're never going to get a Palestinian state and peace with Israel under those circumstances. And if you'll remember, we caught him a couple years later taking arms from Iran through the ship the Karine A. So I just don't think that you can make a comparison between Yasser Arafat and Abu Mazen, somebody who's clearly committed to peace and who's prepared to stand on a peace platform. There's a reason Yasser Arafat couldn't make a deal."

Rice also found a positive aspect to Hamas, noting that its involvement in the political system and participation in elections have made things "in some sense more complicated," but she said its inability to govern "has led Hamas to, I think, some very, very difficult situations in which they're trying to find their ways out." Rice noted that in 2000, Hamas had been a resistance movement not at all involved politically.

In commenting on the internal Israeli situation, Rice said, "The differences on the Israeli side are also very fundamental. Do you really think Ariel Sharon was going to support the Camp David Accords - Likud? Doesn't look like it, does it? Because in fact, the - what has happened now is that by 2003 Ariel Sharon was able to, was willing, to make a shift from the right of the Israeli political spectrum and to begin to talk about dividing the land. The Herzliya speech was one of the most important speeches in recent Israeli political history. He starts to talk about dividing the land. He accepts the two-state solution. He accepts the road map. And now the breadth of the Israeli political system that is actually united behind a two-state solution is very different than in 2000."