Jewish Settlers, Arafat Meet on Peace, Business

JERUSALEM (Reuter) - Jewish settlers had a rare meeting with Palestinian leader Yasser Arafat to urge tolerance and joint business deals, participants said Wednesday.

A PLO official who took part said Arafat welcomed the Tuesday meeting and told the 10 settlers a Palestinian state was the only way to peaceful coexistence.

The 90-minute meeting, at a church in Palestinian-ruled Bethlehem, became public only after it ended. Even then, only two Israelis admitted taking part.

"I haven't heard about any such meeting and it's hard for me to believe such a meeting took place," Zvi Katzover, a settler leader, told Reuters when asked about it.

Arafat, a former guerrilla leader, is still viewed by many right-wing Israelis as a terrorist despite having become Israel's partner in a breakthrough 1993 peace deal.

Israeli participant David Bedein said the meeting was prompted by an interest in tourism and other business.

"There are three, maybe four business opportunities on the table right now, and the Palestinians whom the settlers are in touch with were not willing to go ahead without Arafat's approval.

"Last night he gave the approval," Bedein said, adding that the Palestinian leader had established a committee to conduct business ventures with the settlers.

He said it was logical for Israelis and Palestinians to work on tourism ventures along a West Bank stretch from Bethlehem to Hebron brimming with Jewish, Christian and Muslim holy sites.

Bedein said settlers from Hebron, a West Bank city long due to be given self-rule, took part in the meeting. Some 400 settlers live and study in the city among 100,000 Palestinians.

"It was a very good meeting," said the PLO official, who declined to be identified.

"Kiryat Arba and Hebron settlers have a very bad reputation, but we are meeting you now and we find you nice people," the official said the settlers were told.

Another who attended was Yehuda Waxman, father of an Israeli soldier kidnapped in 1994 by Palestinian guerrillas and killed in a gunfight between his captors and Israeli soldiers.

"Everyone spoke a few moments and there were different stances. It was possible to speak openly, in a businesslike way and that's what people did," Waxman told Israeli army radio.

Waxman solicited Arafat's support for the Palestinian Authority's participation in a center to advance tolerance set up in the name of his son, Nachshon Waxman.

Most of the 130,000 Jews who live in settlements among the two million Palestinians of the West Bank and Gaza Strip oppose Israel's peace deals with Arafat.

Palestinians view settlements as illegal, and the United States, Israel's closest ally, called a defiant visit by right-wing Prime Minister Benjamin Netanyahu to a settlement on Tuesday a "very complicating factor."

"Tell Netanyahu what you are telling us, that you support peace and coexistence," the PLO official quoted Arafat as saying at the meeting.

Bedein said Israelis still wanted to hear Arafat say to his own people the "nice things" the Palestinian leader tells Jews. But Arafat insisted the PLO had proven its commitment to peace by changing its charter calling for Israel's destruction.