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JERUSALEM (JPS) Palestine Liberation Organization chairman Yasser Arafat ordered $10 million be allocated to Israeli Arab parties and municipalities to form a lobby to establish a Palestinian state, according to documents obtained by The Jerusalem Post.

But Palestinian Authority officials declared the documents a forgery obtained and distributed by right-wing Israeli circles to embarrass the government.

In a letter dated Aug. 15, 1994, and marked top secret, Palestinian Authority Finance Minister Mohammed Nashashibi reports a decision by Arafat to invest millions to spread his influence in the Israeli Arab sector.

Nashashibi says responsibility for the recruitment of Israeli Arab support has been given to Arafat's adviser Ahmed Tibi, an Israeli citizen.

Nashashibi says the $10 million will be immediately allocated to help Arab councils cover their deficits and as contributions to church leaders and philanthropic organizations.

Israeli officials deny report of Syria deal

JERUSALEM (JTA) — Israeli officials have denied a newspaper report that Israel had reached a secret, preliminary agreement with Syria to gradually withdrawal from all of the Golan Heights.

The Prime Minister's Office and Foreign Ministry issued statements Tuesday saying there was no truth to a report in the French weekly Tribune Juive that said Foreign Minister Shimon Peres had signed an agreement on a staged withdrawal from the Golan over the course of 10 years.

The Jewish paper said Peres and four other Israeli ministers were in Paris on June 5 to sign the agreement.

The report added that according to the agreement, both countries would hold national referendums on any final peace deal, which would be annulled if it did not gain a majority of public support.

"I deny the whole thing," said Behira Berdugo, Peres' spokeswoman. "Peres was in Israel that day. No such thing was signed."

There has so far been no reaction to the report from Syrian officials.

Palestinian prisoners launch hunger strike

JERUSALEM (JTA) — Palestinian security prisoners began a hunger strike Sunday, demanding their release from Israeli prisons.

Reports that Palestine Liberation Organization leader Yasser Arafat was joining the hunger strike to show solidarity with the prisoners were denied by Palestinian officials.

But Arafat called on Israel to release the prisoners.

About 6,000 prisoners are now held in jails in Israel and the West Bank.

Some 3,000 of them belong to the Islamic fundamentalist Hamas movement; about 2,500 belong to Al Fatah, the PLO's mainstream group; and the rest belong to smaller factions.

The hunger strike began at the Nablus jail in the West Bank and was expected to spread to other prisons.

Georgia to open Jerusalem embassy

JERUSALEM (JTA) — The former Soviet republic of Georgia will open an embassy in Jerusalem, according to the country's president, Eduard Shevardnadze.

He made the announcement Monday at the Prime Minister's office in Jerusalem, where he and Prime Minister Yitzhak Rabin signed a cooperation agreement covering culture, communications and agriculture.

Earlier in the day, the visiting leader toured Jerusalem's Old City and the Yad Vashem Holocaust Memorial.

Only a handful of countries maintain an embassy in Jerusalem, with most preferring to maintain their diplomatic headquarters in Tel Aviv.

$10,000 reward is offered by father

JERUSALEM (JTA) — The father of an Israeli who disappeared last year while backpacking in Tibet has offered $10,000 for any information regarding his whereabouts.

He also announced that a group of former members of an elite Israel Defense Force combat unit were due to leave for Tibet in two weeks to look for Nir Korech, 24, who is their comrade.

Korech was last seen near the Tibetan-Bhutanese border. He had told another backpacker that he planned to explore an area that is off-limits to foreigners. Previous search expeditions failed to turn up any signs of Korech.

Travel fever hits many young Israelis after their release from the army. Although some stick to more commonly traveled routes, others, such as Korech, try to push the outer bounds.

Israel weighs Iraqis' request for asylum

JERUSALEM (JTA) — Israel's High Court of Justice is considering the appeal of 31 Iraqis seeking temporary asylum here.

At a hearing two weeks ago, the state argued that some of the Iraqis posed a security threat and asked that they all be kept in jail until they could be deported.

The hearing was expected to be the final one on the fate of the Iraqis, who were jailed after sneaking into Israel across the Jordanian border.

Some have been in prison for as long as two years.

A lawyer representing the Iraqis said fleeing to Israel makes it impossible for them to return home.

"The fact they chose Israel as a place of asylum automatically converted them into traitors who can be prosecuted by Iraq," said Zvi Reich, a lawyer for the Association for Civil Rights in Israel.