PLO and Israelis deadlocked despite a 'meeting of minds'

proposal which they said still failed to solve disputes that have

delayed Israel's withdrawal from Gaza and Jericho.

Israeli Foreign Minister Shimon Peres told a news conference today

after three days of intensive talks in Cairo that the two sides had

reached a ''meeting of the minds'' and a document had been drafted

reflecting their joint position.

But PLO information chief Yasser Abed-Rabbo later denied that the

Palestinians had agreed to the contents of the draft, which was leaked

to the Israeli media and published in morning papers.

He said the PLO hoped to send the Israelis a document later today

offering a compromise solution to three main problems: control of border

crossings between Egypt and the Gaza Strip and between Jordan and the

West Bank area of Jericho, the area of Jericho, and security for Jewish

settlements in Gaza.

''What Peres said is complete exaggeration. It is an attempt to bluff.

Such kinds of games in the negotiations might kill the present form of

the talks,'' Abed-Rabbo said.

A Palestinian source said Abed-Rabbo was hinting that the PLO might

refuse to continue negotiating with Peres and insist on talking directly

to Israeli Prime Minister Yitzhak Rabin.

The chairman of the PLO (Palestine Liberation Organisation), Yasser

Arafat, rushed to Cairo last night to discuss his objections to the

Israeli document with Egyptian President Hosni Mubarak.

PLO negotiator Nabil Shaath told reporters today that after the

failure of the Liaison Committee led by Peres and the PLO's Mahmoud

Abbas, lower-level talks headed by himself and Israeli Major-General

Amnon Shahak would resume soon in the Egyptian Red Sea resort of Taba.

Shaath told reporters after PLO leader Yasser Arafat met Egyptian

Foreign Minister Amr Moussa: ''There are points of difference and points

of agreement. There are still differences on the crossings, there is

progress on the point about the Gaza settlements. We are determined to

continue and will return to Taba soon.''

He added: ''We will send our response to General Shahak. I will send

it in the name of the Palestinian leadership today.''

Under a breakthrough Declaration of Principles signed by Peres and

Abbas in Washington in September, Israel should have started to withdraw

from Gaza and Jericho on December 13, its first retreat from any of the

territory claimed by the Palestinians as their homeland.

Rabin forced Arafat to accept an indefinite delay on December 12.

PLO sources in Tunis largely confirmed Israeli media accounts of the

Israeli draft.

On the crucial point of the crossings, it conceded that Israeli

identity checks on West Bank and Gaza Palestinians ''will basically be

carried out by electronic means.''

He said the PLO accepted there could be 'coordination' with the

Israelis over the entry of Palestinians from parts of the West Bank

outside the Jericho area until Palestinian self-rule takes effect in

these districts in mid-July next year.

Abed-Rabbo added that the PLO also insisted that Palestinian police

should be stationed on the Allenby bridge over the river Jordan, not

some distance inside the West Bank.--Reuter.