The Washington Times - June 18, 2009, 02:15PM

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CAIRO — Their nation’s GDP may only be 40 percent the size of Wal-Mart’s annual revenues, with widespread poverty and limited freedom of expression, yet 70 percent of Egyptians say the Palestinian question is the most important “domestic” issue for them, according to Nabil Fahmy, ambassador-at-large for the Egyptian Foreign Ministry.

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Aggravating the situation is the newly-elected conservative government in Jerusalem led by Benjamin Netanyahu, whose recent speech on the Israeli-Palestinian conflict has elicited a negative response from many in the Arab world.

Fahmy said he was “flabbergasted” by Israeli Prime Minister’s address, saying it called for Arabs to accept a “Zionist narrative” requiring Palestinians to offer retribution for the Holocaust, which involved Europeans committing violence against Jews.

“It was typical Netanyahu, trying to put together things, trying to be cute. It’s beyond being reasonable,” Fahmy said. “I do think this was an extremely bad speech by Netanyahu. There’s really nothing there that would help the peace process.”

Fahmy said progress could not be made unless a two-state solution involved two capitals located in Jerusalem and boundaries based drawn up in 1967. 

It’s fascinating that Palestine is considered a “domestic issue” when only a small number of Palestinians live in the country.