ISRAEL - May 24 - Netanyahu Calls For Broadening Of Peace Talks.

Benjamin Netanyahu, leader of the Likud party and favourite to be Israel's PM after the next elections, argues that "some kind of federation or confederation between Jordan and the Palestinians" will enhance the prospects for Middle East peace. In an interview with the FT in Jerusalem, Netanyahu said that the broadening of peace talks with the Palestinians, to include Jordan and Egypt, would increase opportunities for a positive outcome. One example "would be tackling a major problem the Palestinians have, which is instituting law and order in their own cities and streets and preventing the spillage of violence into their own homes and into ours". But both Palestinians and Jordanians reject the idea of a confederation, dismissing it as an Israeli ploy to prevent the creation of an independent Palestinian state. Martin Wolf's full interview with Benjamin Netanyahu Netanyahu agreed that the fear that many Arab regimes felt for Iran created a strategic opportunity for Israel. But he rejected the Saudi Arabian peace plan, which was reaffirmed by the Arab League in March. He dismissed the initiative as a reiteration of "traditional Arab demands" for Israel to return "to the indefensible [pre-] six-day war lines [of 1967] and be prepared to negotiate on its own dissolution, on the so-called right of return of the so-called Arab refugees and that's not helpful". The Arab peace plan is a general framework that envisages direct talks between all the parties concerned, not just Israel and the Palestinians. "Assuming we had a peace process, I would say to my Palestinian interlocutor, 'I am prepared to make substantial concessions,'?" said Netanyahu. "But I want to know right now that these concessions result in peace and they end any more demands on your part and that you renounce here and now the demand for the flooding of Israel with millions of Palestinian refugees. It cannot be a subject for negotiations". Security remains a dominant concern. "We now have three live fronts: one Hizbullah [in Lebanon], which has rearmed itself with more weapons than it had before the war and better kinds of weapons; second, Gaza, which is turning itself into a second Lebanon; and, third, Syria, which is arming itself feverishly, which is something it has not done in 30 years". Behind this is Netanyahu's concern about Islamic radicalism. "The largest issue confronting Israel is the tide of militant Islam sweeping our region and threatening the entire world. But it is centred in the Middle East and the two streams - the Shi'ite stream in Iran and the Sunni stream in al-Qaeda - they sometimes collide with each other, but more often than not, as in Iraq, they collude against a common enemy". Describing Iran as the more dangerous, Netanyahu said: There are three things you can do. First, you can do nothing, in which case they will get the weapons, possibly in three or four years. "Second, you can reserve the military option, preferably by the US, which has the means to do so. But that should be a last resort". Finally, "you can use the economic weakness of the regime to put economic pressure upon it by a combination of actions to limits its credit lines and divestment, divesting by companies, primarily European companies, that do business there".