Israel to Move Jewish Settlers Inside New West Bank Border, PM Says

Israel will impose a West Bank border largely along the route of its current separation barrier and move all Jewish settlers to the Israeli side, acting Prime Minister Ehud Olmert said in interviews Friday.

The plan presented by the front-runner in March 28 elections — the clearest blueprint yet for ending the conflict with the Palestinians — would involve uprooting some Jewish areas but beefing up major settlements in parts of the West Bank that Israel would retain.

In the past, candidates for prime minister have been vague about the fate of the West Bank, for fear of losing voter support.

The Palestinians said they oppose unilateral steps and called for an immediate resumption of peace talks, an unlikely event since the Islamic militant group Hamas is poised to form the next Palestinian government. Hamas opposes peace talks with Israel and Olmert said he would have no dealings with a Hamas-led Palestinian Authority.

Olmert said he would retain control over Jerusalem, including areas of the city claimed by the Palestinians for a future capital, and build another large West Bank settlement near the city. However, he also indicated he was ready to give up some Arab neighborhoods.

In interviews earlier this week, Olmert said he would keep Gush Etzion and Maaleh Adumim, near Jerusalem, and Ariel, deep in the West Bank, as well as maintaining control over the Jordan River Valley, the line between Jordan and the West Bank.

However, it is unclear whether he could retain these areas, especially Ariel.

Also Friday, the European Union threatened to cut off aid to a Hamas-led Palestinian government "unless it seeks peace by peaceful means" — its strongest signal yet to the new leadership. The EU foreign ministers reviewed financial aid to Palestinians but announced no immediate halt to funds.

Olmert said he still hopes to reach a settlement, but the chances of a deal have dimmed with Hamas' victory in Palestinian legislative elections. Hamas rejects Israeli demands to renounces violence and its calls for destruction of the Jewish state.

Olmert threatened to assassinate the incoming Palestinian prime minister, Hamas lawmaker Ismail Haniyeh, if he is involved in terrorism.

"Anyone who is involved in planning terror attacks will be a legitimate target for liquidation," Olmert told the Yediot Ahronot daily, echoing threats made by his defense minister several days earlier.

Olmert told Yediot that if the Palestinians "prefer to be dragged into the axis of evil of Iran," then Israel will draw its own border in the West Bank based on its security needs.

"At the end of the process we will reach a complete separation from the vast majority of the Palestinian population," he told the Maariv daily.

Olmert said Israel would set its border by largely following the separation barrier it is building in the West Bank, but adjusting the route.

He told Yediot that he would try to work with Jewish settler leaders to try to get them to agree to the new line, moving settlers into settlements he plans to incorporate into Israel.

"We will definitely change the route either east or west in accordance to internal Israeli agreement," Olmert told the paper. "The fence that will be built ... will be the border line that will separate Israel and the Palestinians. Israelis will not live beyond the fence," he said.

In the absence of peace talks, Olmert's unilateral approach is meant to solve Israel's main security problems and preserve the country's status as a democracy with a Jewish majority. It follows Prime Minister Ariel Sharon's unilateral pullout from the Gaza Strip last summer.

Olmert seems ready, though, to go further than Sharon, who ruled out any further unilateral action after the Gaza pullout. Olmert, a close Sharon confidant, took over as acting prime minister after Sharon's stroke Jan. 4. Sharon, 78, remains in a coma.

Palestinian negotiator Saeb Erekat urged Israel to return to the bargaining table.

"Israel cannot determine my borders by dictating them to me. That only prolongs the conflict, rather than solving it," he said.

Palestinian leader Mahmoud Abbas, who favors a resumption of peace talks, remains in office and has been trying to work out a power-sharing agreement with Hamas.

In Gaza, Hamas lawmaker Mahmoud Zahar rejected Olmert's plan.

"We cannot recognize any sort of these borders, especially the borders created by the wall," he said.

Olmert told Yediot he will consult with world leaders to win recognition for the border.

"First of all, I will talk to President Bush," he said.

Bush has backed Israel's claims to retaining some settlement blocs, but American officials have reacted coolly to Israeli claims on Ariel. Washington has also expressed displeasure over Israeli plans to link Maaleh Adumim to Jerusalem, despite Olmert's assertion in Yediot that the U.S. "has no doubt" that this will happen.

Officials at the U.S. Embassy did not return a message seeking comment.

Even with the settlement blocs under Israeli control, the plan would mean a pullout from most of the West Bank and removal of dozens of settlements.

Settler leader Bentzi Lieberman said the Gaza pullout was a surrender to Palestinian violence, and further unilateral action would threaten towns inside Israel.

"Now the Palestinians know that terrorism pays off," he said. "I think his plan is a serious danger to Israel. He is bringing Hamastan to our doorsteps."

Olmert's political rivals also attacked his latest plan.

"The only problem is who does Ehud Olmert intend to negotiate with," Amir Peretz, leader of the centrist Labor Party, told Israel Radio.

Uzi Landau, a candidate with the hard-line Likud, said Olmert would threaten the nation's security, likening Olmert to "letting a little boy play with matches."

"Olmert will relinquish territory in exchange for absolutely nothing in return," Landau told Israel Radio. "Before our eyes ... a terror state is being built on the Samarian hills," he added, using a biblical term for the West Bank.

Olmert joined Sharon in November in bolting the Likud and forming the centrist Kadima Party.

Kadima continues to hold a wide lead in opinion polls, but support has been dropping. A new poll published in the Jerusalem Post on Friday showed support for Kadima falling to its lowest levels since Sharon's stroke.

The poll, conducted by the Smith Institute, said Kadima would win about 35 seats in the 120-seat parliament, down two seats from a week-earlier poll. The Institute poll surveyed 501 people and had a margin of error of 4.5 percentage points. The paper said it was the fifth consecutive week of decline for Kadima.