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UN Secretary-General Kofi Annan on Tuesday gave a boost to Middle East peace activists, who warned him that "time was running out" on an Israeli-Palestinian two-state solution.

Sari Nusseibeh, the president of Jerusalem's Al-Quds University, and Ami Ayalon, a retired navy commander and the former head of the Shin Bet security agency, lobbied Annan on their one-page "statement of principles" drawn up as a basis for a peace settlement.

Scorned by Prime Minister Ariel Sharon, the two campaigners have gathered supporting signatures of 100,000 Israelis and 60,000 Palestinians in a three-month period.

Annan applauded their efforts and courage, saying that grass-roots initiatives "helped to create a vision of a common future," according to a UN read-out of the meeting.

While there was no substitute for official negotiations, Annan said "people-to-people initiatives can play an essential role in generating the momentum needed for peace."

Separately, another group of opposition prominent Israelis and Palestinians is preparing a model peace treaty in Geneva, with exact maps of borders.

Annan lauded this venture also, saying that its leaders, Yossi Beilin, a former Labor Party Justice Minister, and Yasser Abed Rabbo, an ally of Arafat, also strived to "find a path to peace."

Ayalon told reporters after the meeting with Annan that "Time is running out. Time is against the option of a two-state solution, which is the only way for Israel to have a safe home and the Palestinians to have a state."

He said that demographic considerations and Israeli settlements were altering the situation, and that people were slowly giving up hope. "More and more people do not believe any more that we can have it," Ayalon said."

Their plan, under the rubric, "the People's Voice," is similar to what ex-President Bill Clinton proposed three years ago and Arafat rejected. Since then, Sharon has done the same.

"This is a chance for the people to say 'We want change, this is a change we are prepared to have, this is a price we are prepare to pay, and we call upon you, the leaderships (of the two sides) to make this possible," Ayalon said.

According to the plan, a Palestinian state would be created in the West Bank and Gaza, minus some border modifications on land adjacent to Israel where many settlers live. Jerusalem would be divided according to its already segregated neighborhoods and become the capital of both nations.

In exchange for Israel removing settlements in the occupied territories, the Palestinians would forgo the "right of return" for four million refugees and their descendants. The Palestinian state would be demilitarized.

Nusseibeh, a Palestine Liberation Organization veteran, said their proposals needed to be inserted into the "road map," drawn up by the Quartet of Middle East advisors, the United States, Russia, the European Union and the United Nations.

"This one page insert outlines the vision that is absent in road map," he said. "This speaks honestly to people, presenting them with the principles that will be the basis for any viable two-state solution."

The nearly dormant road map lays out steps the two sides should take along the way to setting up a Palestinian state by 2005. But it has bogged down over Israeli demands that the Palestinian Authority crack down on militants and Palestinian suspicions that Israel would give nothing in return.