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Prime Minister Ehud Olmert and Palestinian Authority Chairman Mahmoud Abbas will meet Monday in Jericho, the Prime Minister's Office confirmed Sunday afternoon.
Representatives of Olmert and Abbas met Sunday morning to finalize the location and focus of the scheduled meeting.
The West Bank city was mooted as a site for talks the last two times Olmert has met with Abbas. On both occasions, the meetings were held in Jerusalem.
An official in the Prime Minister's Office said the summit's agenda would include for the first time issues connected to a declaration of principles on a final settlement agreement. Last week, Olmert told US Secretary of State Condoleezza Rice he was ready to discuss substantive issues in an effort to reach an agreement on principles ahead of the Middle East peace conference planned by Washington and tentatively set for November.
The official stressed, however, that discussions on the principles of a final settlement were not the same as negotiations on the details of contentious final status issues such as Jerusalem, borders and Palestinian refugees.
Also expected to be on the agenda are security issues including Palestinian efforts to strengthen their security forces, economic measures to help the Palestinians and steps to build Palestinian governmental institutions.
Sources close to Abbas said he was optimistic about the prospects of reaching a declaration of principles on a final settlement with Israel before the peace conference.
According to the sources, Abbas believes the two parties are closer than ever to reaching a deal on the fundamental issues.
"We believe we can achieve progress over the next three months," the sources close to Abbas said. "Our goal is to go to the conference later this year with a declaration of principles that will be acceptable to both sides."
Nabil Amr, political adviser to Abbas, said Monday's summit would be the first step toward tackling important political issues between the Palestinians and Israel. This would be the first time since the botched Camp David summit in 2000 that the two parties discussed such issues, he said.
This week's summit, he added, was one of the results of Rice's visit to Israel and Ramallah last week.
The summit comes ahead of the regional conference that was called by US President George W. Bush, he said. "That's why we have good reason to believe that the summit will focus on political issues concerning the Palestinians and Israelis."
Amr said the Palestinians would raise all final status issues, such as the future of Jerusalem, the final borders of the future Palestinian state, the "right of return" for the refugees and the status of the settlements in the West Bank.
"We have many reservations about Israel's vision for a final settlement," he said. "However, one must admit that there are some positive elements in the Israeli position".
Abbas was also planning to demand the release of more Palestinian security prisoners from Israeli jails, the removal of IDF checkpoints and an end to the construction of the security barrier in the West Bank, Amr said.
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