Mubarak firm on final status push in Obama talks

Egyptian President Hosni Mubarak warned Tuesday in talks with President Barack Obama it was time to ditch "temporary solutions" and hold final status talks between Israelis and Palestinians.

Obama, stepping deeper into the details of Middle East peacemaking which have confounded his predecessors, said meanwhile he saw "movement in the right direction" from Israel amid a rare showdown with Washington over settlements.

As the president prepares to send his special envoy George Mitchell back to the region, Mubarak's spokesman said after the talks that Egypt hoped the administration would unveil a comprehensive Middle East peace plan next month.

Mubarak came to Washington stating forcefully that arguments over issues like Israeli settlements in the occupied West Bank and Arab concessions to Israel were detracting from the wider search for Middle East peace.

"We need to move to the final status solution and level," Mubarak told reporters as he sat with Obama in the Oval Office.

"I have contacted the Israelis and they said 'perhaps we can talk about a temporary solution,'" Mubarak said.

"But I told them, No, I told them, forget about the temporary solution, forget about temporary borders," he said, referring to debate about the future shape of a Palestinian state.

Israel has resisted the idea of moving immediately to the most intractable issues with the Palestinians including the status of Jerusalem, the borders of a final Palestinian state and the right of return for Palestinian refugees.

Israeli Foreign Minister Avigdor Lieberman told US lawmakers last week that pushing for a fast-track deal over the next year would not work and proposed concentrating on improving security and Palestinian economic conditions.

Obama called on all parties in the Middle East to take "risks" and devote hard work to jolting stalled peace talks back into motion.

"If all sides are willing to move off of the rut that we're in currently, then I think there is an extraordinary opportunity to make real progress, but we are not there yet."

The US president also praised Israel over the hawkish government agreed to curtail construction in the occupied West Bank as a gesture to Washington.

"There has been movement in the right direction," Obama said, saying the Israeli government was taking its talks with Washington seriously.

"My hope is that we are going to see not just movement from the Israelis, but also from the Palestinians around issues of incitement and security, from Arab states that show their willingness to engage Israel."

Obama has been pushing Arab states to make small concessions to Israel to unlock deadlocked peace moves and has called on the Jewish state to halt expansion of settlements on the occupied West Bank.

Earlier, Israeli Prime Minister Benjamin Netanyahu, Defense Minister Ehud Barak and Housing Minister Ariel Atias agreed no new tenders for settlement construction in the West Bank should be issued until early 2010.

But Palestinians and other critics dismissed the move as insignificant, pointing out that construction continues on the ground in a number of settlements in the Israeli-occupied Palestinian territory.

Mubarak opened the press availability with Obama in the Oval Office by pouring warm praise on the US president over his historic address the Muslim world in Cairo in June.

"He came to give his address, it was a very strong address and it removed all doubts about the United States and the Muslim world," Mubarak said after meeting Obama at a White House summit.

"The importance of the Cairo visit was very appreciated by the Muslim Islamic world because the Islamic world had thoughts that the US was against Islam... but his great, fantastic address there has removed all those doubts."

After the talks, Mubarak's spokesman Soliman Awaad told reporters that he hoped Washington would be ready to unveil a comprehensive Middle East peace plan at around the time of the UN General Assembly next month.

"Today, Mr. Obama said that hopefully after Mitchell and Netanyahu meet next week, the peace blueprint should be there in the course of next month, in September," Awaad said.