*Source: By Amy Teibel Associated Press
(NSI News Source Info) JERUSALEM, Israel - June 22, 2009: Israel's defense minister said in an interview published Tuesday that he expects Prime Minister Benjamin Netanyahu to agree to the principle of Palestinian statehood — something the Israeli leader has balked at doing since taking office a month ago. In this handout photo released by the Israeli Government Press Office (GPO), Israeli Prime Minister Benjamin Netanyahu meets with Druze leaders in his office on June 21, 2009 in Jerusalem, Israel. Druze leaders and the government are locked in a dispute about state funding for Druze communities in Israel.
Netanyahu is coming under increasing pressure from Washington to resume peacemaking with the Palestinians, a process designed ultimately to create a Palestinian state that would live alongside Israel peacefully within fixed borders.
In what could be seen as a mild slap from the U.S., Israel's ceremonial president, Shimon Peres, will meet President Barack Obama next week, before Netanyahu travels to Washington in mid-May. A statement from Peres' office said he would attend next week's conference of AIPAC, the pro-Israel lobby, and meet Obama.
Peres, a Nobel Peace Prize laureate, is a world-renowned Mideast peacemaker, while Netanyahu has a hawkish reputation. Netanyahu took office March 31 amid predictions of a clash with the Obama administration over peacemaking.
Netanyahu has stepped back from his original plan to hold off on political negotiations while working with the Palestinians to improve their economy. But Netanyahu has stopped short of endorsing a separate Palestinian state, a key element of U.S. policy.
In an interview with the Haaretz daily, Defense Minister Ehud Barak suggested that Netanyahu could relent.
"I believe that during Netanyahu's visit to Washington, Israel must formulate how it intends to move forward, and that formula will not propose three states for eight peoples," Barak said.
The prime minister's office would not comment. But an aide to the prime minister said a policy review was under way and should be completed around the time Netanyahu goes to Washington. He spoke on condition of anonymity because he wasn't authorized to publicly discuss emerging policy.
The Palestinians hope to set up a state in the West Bank, Gaza Strip and east Jerusalem, territories Israel captured in the 1967 war.
Israel has annexed east Jerusalem, and some 230,000 Israeli settlers live in the West Bank. Israel withdrew its troops and settlers from Gaza in 2005. But the coastal territory is now controlled by the Islamic militant group Hamas, complicating potential peace efforts. Israel considers Hamas, which rejects Israel's right to exist, a terrorist group.
In a reflection of the sensitivity of the situation, a Palestinian military court convicted a man of treason and sentenced him to death for selling West Bank land to an Israeli company.
Abbas routinely withholds the required approval of such sentences, however.
Barak's centrist Labor Party, which supports Palestinian statehood, is the lone moderate voice in Netanyahu's government. But during his two years as defense minister in the preceding government of Ehud Olmert, Barak rebuffed Palestinian demands to halt settlement expansion or remove a significant number of Israeli roadblocks that encumber Palestinian movement in the West Bank.
In a separate interview published Tuesday, Netanyahu's other top policy-making partner, Foreign Minister Avigdor Lieberman, denied that Jewish settlements in the West Bank were an obstacle to peacemaking, as Palestinians and the international community claim.
Lieberman also said Israel can't negotiate peace with the Palestinians until they dismantle militant groups and set up a proper justice system. The Palestinians committed to do so under the U.S.-backed "road map" peace plan of June 2002 — which obliged Israel to halt all settlement construction.
"To jump straight to the last paragraph and to concede on all of the Palestinian commitments to fight terror — it's a very strange approach," Lieberman told The Jerusalem Post daily.
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