- The Washington Times - Friday, September 15, 2000

NEW YORK Palestinian and Israeli negotiators resumed hastily scheduled peace talks with U.S. diplomats yesterday, but State Department officials cautioned against expectations of a breakthrough in Middle East peace.

"This is an evolving situation," Secretary of State Madeleine K. Albright told reporters.

"I think that what is necessary here is to have the flexibility both of process and of thought in trying to get these issues resolved," she said.

The largest obstacle remained who would control predominantly Arab East Jerusalem.

However, other intractable "final status" disagreements are still on the table, including water rights, the return of Palestinian refugees and national boundaries.

"Obviously nothing is agreed until everything is agreed," Mrs. Albright said.

The new talks were announced Wednesday, the deadline that the Israelis and Palestinians had set last year for a final settlement and the day the Palestinian Authority was to have declared statehood.

The decision on Palestinian statehood has been deferred for at least two months, a move Mrs. Albright praised yesterday.

"It is September 14, and September 13 passed without the declaration of a Palestinian state unilaterally," she said.

She declined to be more specific.

Nabil Shaath, a senior Palestinian official, is to meet with National Security Adviser Samuel R. Berger today.

Mr. Berger said yesterday that the Clinton administration wants to establish "a base line" to measure progress in peacemaking between Israel and the Palestinians over the next few weeks.

Mrs. Albright was to dine last night with Israeli Foreign Minister Shlomo Ben-Ami, while Washington's chief Middle East mediator Dennis Ross was to sit down with Palestinian negotiators Saeb Erekat and Mohammed Dahlan.

"Neither side can have 100 percent of what it wants and we can't come out with one side feeling that it has won and the other lost," Mrs. Albright said.

She declined to comment on published reports suggesting an international and presumably neutral body to oversee the contested sites in Jerusalem that are sacred to both Muslims and Jews.

The Israelis and Palestinians met for two weeks early this summer at Camp David, along with President Clinton and other senior American officials. However, those talks collapsed.

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