Prime Minister Ariel Sharon struck a note of optimism yesterday when he said "the conditions have been created that will enable us and the Palestinians to reach a historic breakthrough in our relations."

Speaking at a meeting of the Contractors Association, he described the breakthrough as one "that will bring us to calm and security and in the future to the desired peace."

Sharon said "we are following with great interest the recent developments in the Palestinian Authority and it is apparent that there is a positive approach to the fight against terrorism and to the furthering of the diplomatic process.

"If the Palestinians take extensive action to end terrorism, violence and incitement, we will be able to proceed in our contacts for the implementation of the road map and it is even possible to coordinate a variety of actions regarding the disengagement plan," he added.

"We are seeing encouraging signs, but these things need to stand up to the test of time," Sharon said.

Among the signs Sharon was referring to was an edict issued yesterday by the new Palestinian leadership banning civilians from carrying weapons.

In issuing the decree, Prime Minister Ahmed Qureia stressed that the "chaos of the weapons" had led to a rise in lawlessness.

Also yesterday, sources in the PA said that Nasser Yousef was due to be appointed interior minister in the Qureia government. Yousef was in charge of cracking down on militants in the mid-1990s and his likely appointment is another signal that the new PA leadership is serious about restoring law and order.

Amos Gilad, in charge of the diplomatic and security sections at the Defense Ministry, visited Cairo on Wednesday, where he met with the Egyptian head of intelligence, Omar Suleiman. The two discussed the plans for the Egyptian military deployment along the Philadelphi route, on the Egyptian side of the Gaza Strip border. Not all details were concluded during the meeting and the dialogue will continue.

Defense Minister Shaul Mofaz met yesterday with the British Prime Minister Tony Blair in London and informed him of plans to meet with Mohammed Dahlan on the possibility that security arrangements can be completed in time to initiate the transfer of West Bank towns to Palestinian security control.

Mofaz expressed his hope that the transfer will take place as soon as the Palestinians are ready to undertake the responsibility.

For its part, the Bush administration is giving strong backing to newly elected Palestinian Authority Chairman Mahmoud Abbas, and expects Israel to assist in his success.

"This is the best man in the foreseeable future and he must be given a chance," senior administration officials told their Israeli counterparts. They also asked that Israel "give time" to Abbas in order for him to gradually deal with terrorism, without ignoring the overall responsibility of the Palestinians to combat terrorism.

In the new, second-term administration of President George Bush, a quartet is being organized for dealing with the Israeli-Palestinian file. It includes Secretary of State Condoleezza Rice, National Security Adviser Stephen Hadley, Elliot Abrams, a White House aide who will be moved up to the number three spot in the National Security Council, and State Department diplomat David Walsh, currently the ambassador to Cairo, who will move to head the Middle East section.

The senior administration officials told their counterparts in Israel that if there are terrorist attacks, Israel should not respond by suspending diplomatic contacts with the Palestinians. According to the American officials, the U.S. had supported Sharon´s decision two weeks ago to suspend contacts with Abbas following the attack at the Karni crossing, but they now believe this should not be a policy in response to every attack.

Sharon met yesterday with the outgoing head of the State Department´s Middle East section, William Burns, who was on a farewell tour of the region. Burns has been appointed U.S. ambassador to Moscow.

The American diplomat told Sharon that the Bush administration has been favorably impressed by Abbas and by the measures undertaken by Israel to facilitate the elections in the territories.

Shin Bet chief Avi Dichter met yesterday with Hadley in Washington, and brought him up to date on the steps taken by the Palestinian Authority to curb terrorism, and the role of Hezbollah in fostering militant activities in the territories.

Also yesterday, Palestinian Authority sources said that Israel is considering the release of 900 Palestinian prisoners as part of a goodwill gesture. (© Copyright 2005 Haaretz. 01/28/05)