Palestinian Faction: Captured Soldier May Be Freed Soon

One of three Palestinian factions that captured an Israeli soldier said Saturday that a prisoner swap could be concluded "in the near future."

The other two factions, also linked to the Palestinians' ruling Hamas Party, made no similar claims. Reports of an impending deal have been rife for weeks.

Abu Mujahed, a spokesman for the Popular Resistance Committees, said his faction had agreed to an Egyptian-brokered deal to release Cpl. Gilad Shalit in return for hundreds of Palestinian prisoners.

"There is an Egyptian proposal that would include the release of our Palestinian prisoners and we agreed on this proposal," he said. "We expect a solution to our prisoners case in the near future."

Shalit was captured June 25 in a cross-border raid and is believed to be held in the Gaza Strip. His abduction sparked an Israeli military offensive there that has killed more than 200 Palestinians, most of them militants.

Egypt has been attempting to negotiate his release. Israeli Cabinet Minister Binyamin Ben-Eliezer, in a visit to Cairo earlier this month, said his government had accepted the Egyptian proposal.

On Friday, the London-based Arabic newspaper al-Hayat said Egypt was close to a deal and Hamas' Syria-based political chief, Khaled Mashaal, was expected to arrive in Cairo to discuss it. But Mashaal's deputy, Moussa Abu Marzouk, denied the report from Syria.

Israeli officials also said they were unaware of any progress in efforts to win Shalit's release.

Saeb Erekat, an aide to Palestinian President Mahmoud Abbas of the rival Fatah party, played down the reports of an imminent deal.

"Efforts are ongoing, but I don't think we are closer today than we were yesterday to solving this problem," Erekat said.

In Gaza, meanwhile, Palestinian police in blue-and-white camouflage uniforms deployed around the parliament building Saturday in an attempt to calm fears of fighting between Hamas and Fatah.

On Thursday, a Fatah spokesman warned of a "bloody Saturday" on which Hamas gunmen would attack Fatah members. The following day, pamphlets distributed in mosques loyal to Hamas warned that security forces loyal to Fatah intended to overthrow the Hamas-led government, a Palestinian official said.

In an attempt to ease tensions, a committee of all Palestinian factions, including Fatah and Hamas, met Friday night in Gaza and agreed to remove all their gunmen from the streets.

"Only uniformed police will be deployed on the streets," said Ibrahim Abu Naja, the committee's coordinator.

Fatah and Hamas leaders also agreed to reactivate a liaison office for the two groups.

In the West Bank city of Ramallah, security forces were posted outside parliament, the prime minister's office and the Education Ministry.

Fears of a bloody showdown rose after gunbattles this month between Hamas and Fatah left more than a dozen dead.

Abu Naja said he wasn't optimistic the calm would last, but hoped Palestinian groups could contain future conflicts.

Erekat announced in Ramallah that the Palestinians' gross domestic product was projected to drop 28 percent in 2006 to $2.9 billion from $4.04 billion in 2005. The projections were based on data from the first nine months of the year, Erekat said.

Investments this year are projected to drop 60 percent to $400 million, from $1 billion in 2005, he said.

Erekat blamed the decline on the international aid freeze imposed in March to pressure Hamas to recognize Israel and disarm and on Israeli closures of vital border crossings.

He warned that if the economic decline continued, the Palestinian areas would face "total collapse."