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As expected, the Palestinian leadership decided yesterday to halt direct talks with Israel as long as settlement construction continues. The decision was announced by the general secretary of the Palestinian Liberation Organization executive committee, Yasser Abed Rabbo.

The spokesman for Palestinian President Mahmoud Abbas, Nabil Abu Rudeineh, said talks with Israel would not continue as long as settlement construction is carried out, but the Palestinian leadership and Arab countries appear in no hurry to actually make the decision final.

A meeting of the Arab League monitoring committee on the Arab peace initiative, which was initially scheduled to decide tomorrow on the future of talks with Israel, was deferred until Wednesday and then again until Friday. It will be held in Libya on the sidelines of next week's Arab summit meeting there.

Abed Rabbo said the Palestinian leadership viewed Israel as responsible for the failure of the talks and for scuttling American and other international efforts. At the same time, the leadership welcomed the attempts at reconciliation with Hamas, following understandings reached last week between senior Hamas and Fatah officials on the renewal of talks between the organizations.

President Abbas is expected to meet today with Jordanian King Abdullah. Yesterday U.S. Middle East envoy George Mitchell visited Cairo following a stop in Qatar. In all probability the Americans have requested time from the Arab states to reach a compromise on the settlement issue.

Prime Minister Benjamin Netanyahu's office has said efforts to find a creative solution on the matter continue, but over the weekend the prime minister's bureau began pointing fingers at the Palestinians in advance of a possible total halt to the talks.

Following the PLO's announcement of the suspension of talks, Netanyahu released a statement calling for the Palestinian president to continue negotiating, with the goal of achieving a peace agreement within a year. The prime minister said this must be achieved by sitting around the negotiating table rather than leaving it. Netanyahu has said there is still a chance that a compromise can be reached, enabling the continuation of the direct talks.

In surprise remarks, Egyptian Foreign Minister Ahmed Ahmed Aboul-Gheit was critical in remarks to the London-based newspaper Al-Hayat of the view that there should no longer be direct talks with Israel as long as settlement construction continues. He said such an approach would mean a lost opportunity to set the future borders of a Palestinian state. Aboul-Gheit also hinted that Hosni Mubarak would run for reelection in Egyptian presidential elections in November 2011.

Netanyahu will not agree to any compromise that involves a resumption of the settlement construction freeze. He is currently suggesting a commitment to restrained construction activity, possibly under American supervision. He told advisers on Friday that such restrained building would not in any way affect final borders and said that unlike Israel, the Palestinians were becoming less flexible.