Lord Owen is a former foreign minister of Great Britain.

London-The Arab-Israeli dispute on the face of it has rarely looked worse. Yet beneath the apparent deadlock are features that give grounds for limited optimism and that can be built on to provide the basis for a settlement.

Firstly, Israeli Prime Minister Ariel Sharon is the only Likud leader to accept a Palestinian state as part of a settlement. In this he carries the majority of the Likud voters, and by opposing a Palestinian state former Prime Minister Benjamin Netanyahu is left with only party activists to confront President George Bush.

Secondly, for the first time, the Saudis-as the guardians of the holiest sites-are involved through the proposals of Saudi Crown Prince Abdullah in a deal with full normalization. This makes a resolution of Jerusalem easier than having them as absent critics.

Thirdly, Palestinians involved with the administration established by Yasser Arafat realize there have to be fundamental changes. Its main financial sponsors-whether the European Union or UN agencies-cannot help rebuild Palestinian infrastructure without real evidence that corruption has stopped and that democratic procedures are being introduced.

President Bush should be able to maintain the first two of these new features. But the United States will need help with the third feature where the Palestinians could easily back off reform. The newly established "quartet" mechanism-consisting of US Secretary of State Colin Powell, the Russian foreign minister, the EU high representative for common foreign and security policy and the UN Secretary General-should examine urgently the option of independent administration and fair and free elections prior to Palestinian statehood. Probably the best solution would be temporary administration by the quartet and, alternatively, the European Union.

The next and most crucial step lies within the White House, for there the style of the US negotiating effort will be formulated. There is a long history of different techniques to choose from, starting from President Eisenhower's principled stance over Suez, Henry Kissinger's Syrian-Israeli shuttle diplomacy and the Camp David negotiations of Presidents Carter and Clinton. Today's choice is simplified by the fact that any remaining goodwill, generated through the Oslo Accords, was finally lost in Jenin, negating face-to-face talks between the parties. That will not return for some years, and the rest of the world is not prepared to wait that long, seeing the resolution of the Middle East as a distinct but necessary element to resolve in the struggle against Muslim extremism.

The US should decide to place before the parties a final-status plan that will involve delineation of the territory that the two states would occupy. Reinforcing that plan will necessitate US forces on the ground to overcome genuine security fears. The political climate for such a military deployment appears greater in the US following Sept. 11 than ever before. In his way Sharon has helped convince many Americans not just that Palestinian suicide bombers are an aspect of international terrorism but that American intervention, both militarily and politically, is essential.

As so often in the midst of conflict, the key to peace lies in agreeing to a map. A final-status map, not an interim map, might mean Palestinians regaining in terms of hectares close to 100 percent of what they lost in 1967, but it would not mean returning to the same land. A swapping of land is made far easier now by the fact that Arabs living in Israel are to an unprecedented extent questioning their continued Israeli citizenship. Also, many more Israelis are wondering whether they can feel secure with Arabs living in such numbers and on so many hectares within Israel as part of a two-state solution. This mutual ambivalence holds the key not only to a territorial resolution but also to allowing some Palestinian refugees to return to what has been ever since 1947 Israeli territory. It also allows the Israelis to keep some of those Jewish settlements in the West Bank that were established for predominantly security reasons.

It is abundantly clear that it is not possible to create a Palestinian state that is territorially coherent and self-sustaining pockmarked throughout with Israeli settlements. And yet Sharon can only be persuaded to pull back from those settlements if he sees American forces on the ground capable of ensuring Israeli security, not just from border incursions but even in the last analysis from invasion. It would be better for American troops to have international troops alongside them, but this is for the US to resolve with Israel. A NATO deployment involving Turkish troops and following the Balkan precedent involving Russian troops would be best.

A US-proposed map can build on the Taba negotiations of January 2001 that moved the Palestinian state from 93 percent to 97 percent of the hectorage Palestinians held in 1967 and allowed 250,000 Israeli settlers to remain. The map will have to reflect existing water tables, underground aquifers and provisions for desalination plants. Secure water supplies are as essential to a two-state solution as military deployments. Interstate trade and the movements of peoples will initially be very constrained, and the old emphasis on economic links between the two states will have to take a back seat until mutual confidence emerges. This means that Saudi Arabia, Jordan and Egypt must play a part in building up the economy of the Palestinian state, and if the Americans can convince the Arabs, the Palestinians will accept a US-proposed map.

Some will say that Sharon will never give up his own map, which concedes only 50 percent of the 1967 hectorage. But he knows the present situation is unsustainable. To take but two examples: a whole armored infantry regiment is defending 300 settlers in Hebron, and Israel has lost 15 soldiers with 34 wounded in defending the Netzarim settlement in Gaza. Israelis will not respond to economic sanctions, but if they reject a firm and fair US plan, they are inviting Washington to walk away.



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