News Analysis: Settlements likely to surge but peace impact uncertain

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JERUSALEM — Is a major surge of new building about to begin in the Jewish settlements in the West Bank?

The answer seems to be yes.

After the Israeli Cabinet's decision last week to end the previous Labor-led government's declared freeze on the settlements, mayors and council chairmen from a score of settlements dusted off ambitious housing schemes and resubmitted them to the planning authorities for approval.

Will this surge of new building necessarily derail the peace process between Israel and the Palestinian Authority?

Palestinians leaders, in their initial, angry reaction to the Netanyahu government's move, grimly predicted that it would. Palestinian Authority president Yasser Arafat called the move a "flagrant violation" of the peace process.

But Prime Minister Benjamin Netanyahu maintained that newsettlements signaled no sea change in policy. The Labor government, despite its declared construction freeze, countenanced the building or completion of thousands of new homes in the settlements, he has pointed out.

According to official statistics, during the past four years of Labor rule, some 40,000 new residents joined the approximately 100,000 Jews who were living in the settlements in 1992. And not all of them were newborns.

Moreover, the settlements — some 130 of them — proved during these past four years not to have been the "obstacle to peace" that they have long been dubbed by successive U.S. administrations.

To the contrary, Israel and the Palestinians made their historic breakthrough to peace in 1993 without then-Prime Minister Yitzhak Rabin's offering to remove a single settlement or settler.

Moreover, Palestinian self-rule has been implemented in the intervening period with little change in the lives of settlers and West Bank Palestinians.

Most significantly, it is now clear that the Labor government and the Palestinian Authority were advancing toward a permanent-status accord in which most of the settlements would have remained under Israeli rule — even with the creation of a Palestinian state.

Just as the new Likud-led government was making its settlement policy clear, a detailed account surfaced about an informal agreement on permanent status reached in 1995 between former Minister Yossi Beilin and Mahmoud Abbas, the No. 2 man in the Palestinian Authority also known as Abu-Mazen.

Yair Hirschfeld, a scholar close to Beilin who was involved in the 1993 secret negotiations with the Palestinians in Oslo and the secret 1995 talks, said the agreement was for a Palestinian state in some 90 percent of the West Bank. But it also allowed Israel to annex West Bank lands on which more than 70 percent of the settlers live.

The Beilin-Abbas draft also said Jerusalem, in its current municipal limits, would remain united under Israeli rule.

The Palestinians were to establish their capital in Abu Dis, a village just outside the city that is considered part of Al Quds, the Holy City, in the Muslim tradition.

In an interview, Beilin indicated that settler leaders did not reject the evolving accord outright. He even hinted that he had elicited similar interest from unnamed members of the current Likud-led government.

Last week's Cabinet decision was widely expected, given the Likud's ideological commitment to the concept of a Greater Israel. Political observers said the decision was even relatively moderate.

While removing restrictions on new building, the Cabinet did not commit the government to any new projects. And it did not pledge to build any new West Bank settlements.

But this is not necessarily how hawkish minister for national infrastructure, Ariel Sharon, views the future. Sharon has instructed units under his authority to press ahead with new road-building in the West Bank — and he reportedly intends to have the completed roads flanked by new Jewish buildings.

Meanwhile, settlement leaders were quick to put forward their local projects for approval and, no less important, for financial support. Government spokesmen, however, say much of the funding for new settlement work must come from the private sector.

In Ariel, for example, officials want to see development and landscaping programs that were frozen in mid-execution now completed with government support.

Ariel Mayor Ron Nachman sent a letter this week to Finance Minister Dan Meridor in which he noted that Ariel had "not built a single home in the past four years" and outlined plans for increasing his town's population from 15,000 to 25,000.

Palestinian officials, meanwhile, branded the Cabinet decision a "declaration of war" against the peace process; some warned darkly of a resumption of the intifada.

Arafat told the Palestinian Authority's legislative arm, the Palestinian Council, that the Cabinet move on settlements poses the greatest threat to the Palestinians, who should resist it.

"This is a conspiracy not only against us, but also against peace," the New York Times quoted Arafat as saying.

"The most important thing is to confront this demon that swallows up everything, including the peace process."

Government sources suggest, however, that a relaxation of the closure of the territories — which Netanyahu pledged Monday during a visit to Jordan — will help ease political pressures in the Palestinian population by improving their economic conditions.

The closure, imposed when Hamas launched the first in a series of terror attacks in Israel in February and March, has been eased in recent weeks to allow some 30,000 Palestinians to return to their jobs in Israel.

The sources suggested the Israel Defense Force's redeployment out of large areas of Hebron, now expected before the end of the month, will also better the short-term atmosphere between Israel and the Palestinian Authority.

But a return to widespread and high-profile settlement construction, even if confined to within existing settlements, could worsen the political situation. The would prove true if the permanent-status negotiations, discontinued since Israel's May 29 elections, fail to restart.

In essence, the Beilin-Abbas accord that came to light last week was designed to get around the obstacle posed by the settlements, because both sides predicated their agreement on the creation of Palestinian state.

But the Netanyahu government remains opposed to the creation of any Palestinian state. It is this issue, rather than settlements, that is likely to spark future Israeli-Palestinian conflict.