WRAPUP 7-Bush vows active US role in Mideast peacemaking

WASHINGTON (Reuters) - President Bush assured Israeli and Palestinian leaders Wednesday the United States would actively engage in renewed peacemaking, despite deep skepticism over chances for a deal before he leaves office.

Just 24 hours after pledging to try to forge a treaty by the end of 2008, Israeli Prime Minister Ehud Olmert and Palestinian President Mahmoud Abbas met Bush for the ceremonial resumption of the first formal peace talks in seven years.

The White House meeting capped a three-day diplomatic flurry, including a 44-nation Middle East conference, that underscored Bush's aim to achieve in his final 14 months in office what has eluded U.S. leaders for decades.

Once wary of taking a hands-on role in Israeli-Palestinian peacemaking, Bush said, "I wouldn't be standing here if I didn't believe peace was possible."

Shoulder to shoulder with the two leaders in the White House Rose Garden, Bush said, "One thing I've assured both gentlemen is that the United States will be actively engaged in the process and we will use our power to help as you come up with the necessary decisions to lay out a Palestinian state that will live side by side in peace with Israel."

But there was no sign Bush was planning the kind of sustained personal engagement he had shunned after his predecessor, Bill Clinton, failed to broker a peace accord in 2000 in the twilight of his presidency.

Olmert and Abbas smiled stiffly at Bush's words but did not shake hands, as they did awkwardly at Tuesday's international conference in Annapolis, Maryland.

After the White House event, the two sides will continue with a meeting on Dec. 12 in Jerusalem. But serious questions remain about the viability of the new peace effort.

All three leaders -- Bush, Abbas and Olmert -- are politically weak at home, raising doubts whether they can make good on their promises, and lingering mistrust between Israel and Palestinians will make any progress difficult.

In a sign of the obstacles ahead, Hamas Islamists who control the Gaza Strip rejected the new peace drive. Violence also flared, with Israeli missiles killing two Hamas naval officers in the southern part of the coastal territory.

In Brussels, Karen AbuZayd, head of the U.N. Relief and Works Agency, which administers aid to Palestinian refugees, , said a peace process that does not include Hamas was not "viable at all."

CORE ISSUES SKIRTED

Bush, who faced criticism for not doing more sooner to resolve the conflict, had opened Tuesday's conference at the U.S. Naval Academy by reading a joint statement painstakingly negotiated by the two sides but which skirted the core issues that divide them.

U.S. officials insisted, however, that all substantive issues would be tackled in future talks.

Beyond accepting a framework for peace talks, neither Olmert nor Abbas gave any sign of ceding ground on their main differences when they addressed the conference on Tuesday.

But the Arab presence, including Saudi Arabia and Syria, gave a boost to Bush's highest-profile peace drive.

Another motivation for many participants was the desire to offset the growing regional influence of Iran, a U.S. foe and outspoken opponent of peace efforts with the Jewish state.

Trying to reinforce the seriousness of the U.S. commitment, the Bush administration planned to name Marine Gen. James Jones, who was NATO commander in Europe until 2006, to help monitor some aspects of the peace process, officials said.

Still, some analysts were skeptical. "There is, I think, considerable doubt remaining about whether the administration is prepared to take on the heavy lifting ... to make this work," said Bruce Riedel of the Brookings Institution, an independent Washington thinktank.

Bush hopes for a foreign policy success to polish his legacy, but the unpopular war in Iraq, the main factor in his low public approval ratings, could limit his room to maneuver.

Olmert's public standing is also low, partly due to last year's Lebanon war, and rightist coalition partners have warned against concessions. Abbas lost control of Gaza to Hamas Islamists in June and only holds sway in the West Bank.

The Annapolis accord emerged from last-minute talks on a joint document meant to chart the course for negotiating the toughest "final status" issues of the conflict -- Jerusalem, borders, security and the fate of Palestinian refugees.

The declaration was mostly vague about the U.S. role. Rice will take the lead for the Bush administration, and the White House has declined to say whether the president might travel to the region to help shepherd the process.

The Israelis appeared to have come away with a greater share of what they were seeking at Annapolis, and many commentators in the Arab world dismissed the conference as a media event designed to repair Bush's image damaged by the Iraq and Afghanistan wars. (Additional reporting by Jeffrey Heller, Adam Entous, Sue Pleming, Mohammed Assadi, Khaled Yacoub Oweis, Caren Bohan and Tabassum Zakaria in Washington, Nidal al-Mughrabi in Gaza, Reza Derakhshi in Tehran, Wafa Amr in Ramallah and Rebecca Harrison in Jerusalem; Writing by Matt Spetalnick; Editing by David Storey)