Italian Prime Minister Romano Prodi became the first European leader on Wednesday to say explicitly that Israel should remain a Jewish state, a statement that implied acceptance of Israel's rejection of the Palestinian claim for a right of refugee return. His remarks came just a day after UN Secretary-General Kofi Annan called for "a solution that respects the rights of Palestinian refugees and is consistent with the two-state solution and with the character of the states in the region." The Jerusalem Post first reported last week that Prodi had said in a private meeting earlier in the month that Israel needed not only security guarantees in order to reach an agreement with the Palestinians, but also guarantees of its right to remain a Jewish state. Diplomatic officials at the time expressed the hope that Prodi would make this statement public, which he did after holding a meeting with Prime Minister Ehud Olmert in Rome.
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Prodi said Italy recognized Israel as a Jewish state, and also "recognized the need for there to be a continuation of this in the future."
US President George W. Bush made a similar commitment to prime minister Ariel Sharon in 2004, and since then Israel has been trying to pry similar statements from European leaders.
Prodi's comments came during a one-day visit by Olmert to Rome, where he also met in the Vatican with Pope Benedict XVI and other leading Vatican and Italian officials.
Olmert, who called Prodi a friend with a "deep relationship with Israel," said Prodi's statement "moved him."
Afterward, in a briefing with Israeli journalists, Olmert said there was "no question, no doubt" that when someone said he recognized the Jewish character of Israel he was rejecting the Palestinian "right of return" demand.
Olmert, who developed a relationship with Prodi when he was president of the European Commission, characterized the meeting as "exceptional" and - in a gesture rare at these types of press conferences - hugged him at the end. He said there was "agreement" with Prodi on all issues.
Prodi, like German chancellor Angela Merkel the day before, said Italy continued to see the road map as the basis of the diplomatic process, and remained committed to the three conditions the Quartet had set for recognizing the PA government - recognizing Israel, forswearing terrorism and accepting previous agreements.
With the heads of the EU countries scheduled to meet in Brussels on Thursday and discuss the Mideast, these types of commitments - according to Israeli diplomatic officials - are important in light of attempts by other countries, such as Spain, to put forth their own initiative.
One of the ideas in the recent Spanish initiative was a call for the convening of an international conference on the Middle East, something Prodi said was premature.
Instead, he said, what was needed were "small steps," which should include easing the humanitarian situation in Gaza, opening up border crossings and a "release of prisoners and captives."
He said the status quo was unacceptable, and that Israel needed to be "generous" in taking steps to move the process forward.
Prodi, like Merkel, also came out strongly against the Holocaust denial conference in Iran, saying it "infuriated" him and that he "unequivocally rejects it."
Olmert termed the conference a manifestation of the "brutal anti-Semitism that characterizes" the Iranian government.
Prodi was more equivocal, however, when talking about sanctions against Iran. He said that since Italy would become a member of the UN Security Council in January, it would be more actively involved in the issue. Prodi said he was in favor of targeted sanctions aimed specifically at Iran's nuclear program.
Italy is Iran's leading trading partner in Europe, with the level of trade - according to Israeli sources - reaching some $8 billion a year. Olmert said the issue was discussed extensively in the meeting, and that he was assured that Italy would be a part of efforts agreed upon by Europe and the UN.
Olmert also said that at a certain point Italy would have to come to the decision that its business interests might suffer in order to preserve what it stands for in the world.
Olmert also said Italy's trade with Iran was only 2.5 percent of its global trade, and that the damage caused by sanctions on Iran would not be that great to the Italian economy.
Regarding the meeting with the pope in the Vatican, Olmert said it was "moving and encouraging. I found someone who was very well aware of all the details of developments in the Middle East."
The pope, according to Olmert's office, also came out strongly against the Holocaust denial conference, and the two discussed the possibility that the pope would address the issue in his next homily.
Olmert called on the pope to encourage pilgrimages to Israel, and also invited him to visit.
According to Olmert, the pope agreed in principle but said that a time for such a visit needed to be worked out.