AMBASSADOR RABINOVICH: Good afternoon, and thank you for coming. I was very much hoping that a few days before the signing of the second peace treaty between Israel and an Arab state we would be having a press conference in this embassy with a different focus in mind. But unfortunately, this is not the case. We have been used to living with terror and conflict, and in the past years this has become less of an Arab effort and more of a Muslim fundamentalist effort directed at us as well as at the peace process. This is something that has preceded the process, it is also directed against the peace process, but it is directed first and foremost at us as a state, as a society, at us as individuals. Israel today is a country characterized by a sense of outrage and by a deep sense of sadness. There are vigils along roads in Israel, vigils in crossroads in Israel, people holding candles expressing this sense, dual sense of outrage and grief.

Terrorism is a phenomenon that has to be fought, fought against, and this is a battle that has to be joined by many. I need not say that it has to be joined by us. We have been in the midst of that battle for a long time and we are determined to continue and to contribute our own share with a greater sense of urgency and with a greater sense of determination than before. There have been three vicious attacks in the past 10 days; the shooting in Jerusalem, the abduction and the assassination of Corporal Nachshon Waxman, and last night this latest outrage. This is a very heavy dose, and our determination, strong as it was, has been reinforced.

Secondly, we call upon and expect the Palestinian leadership, the Palestinian authority, to increase its own efforts in order to dismantle the infrastructure, the Hamas and Islamic Jihad infrastructure in Gaza that has contributed to these latest events.

And thirdly, we hope and call upon the international community to increase its political diplomatic effort and its pressure on Iran that has spearheaded disinformation that has been the source of inspiration and supply for attacks taking place in Israel itself, in the Middle East and internationally. And there's hardly a need to recall attacks in Buenos Aires, in London and even in New York, that all hail back to a very similar source inspiration.

Without a concerted international effort, this will not come to an end. Finally, questions have arisen as to the continuation of the peace process. Let me say very emphatically that we are determined to continue the peace process. If these are attacks that are, among other things, directed at the peace process, that seek to derail the peace process, then the answer is to continue the peace process. The only solution to terrorism beyond the operational activity is a political solution, and the peace process is designed to bring a political settlement to the Middle East. We have partners on the Arab side.

Their ranks have been strengthened in recent days, and together with those partners on the Arab side that are interested in pushing this peace process forward, we will continue.

Thank you very much.

Q: Ambassador, for weeks now we've been hearing of a landscape changing. Israel has relations now with several Arab countries. Several have agreed to not honor barter boycott at least. In the seven hours since this occurred, which Arab countries have expressed any -- have given you any expression of sympathy or understanding, let alone determination to cooperate against terrorism?

AMB. RABINOVICH: There's been a Jordanian statement that I have seen. I must tell you that I have not scrutinized the latest report and I cannot tell you authoritatively which ones have, but Jordan certainly has in the last few hours.

Q: Do you have any basis for confidence that this terrorism against Israel is abhorrent to other Arab parties, including your partners in peace?

AMB. RABINOVICH: Yes. Let me also add that the PLO representative to the U.N. has also denounced this action. I have reason to believe -- the word "abhorrent" may be to powerful for some Arab parties, but I think that there is a general realization on the part of most of the Arab world that this activity and the larger political context within which it takes place is a threat to Arabs at least as much as it is to Israelis. If you ask Arabs what they think of the prospect of a change of government in Algeria, and what they think Hamas and like-minded groups would like to do to them politically and physically, then I think you'll find a wide-ranging support for struggle against this kind of activity.

Yes, please?

Q: U.S. ambassador was instructed to go to the Syrian foreign ministry this morning -- (off mike) -- their support for terrorism. Do you think it's time that they reined in some of the elements that may have been involved in this episode in South Lebanon?

AMB. RABINOVICH: In the last year or so there's been a Syrian effort to curtail Hezbollah activity in South Lebanon with regard to Katyushka attacks against Israel. We would like to see more and we think that the American activity that you have described is very beneficial.

Yes. Please?

Q: Mr. Ambassador, can you please elaborate on a statement made by the Israeli counsel general that Hamas is operating in the United States?

AMB. RABINOVICH: I'm not sure that I would use the present tense. We know that in the past there has been Hamas activity. You have under custody and under prosecution in Israel American citizens of Palestinian extraction who came to Israel and to the West Bank under Hamas instructions carrying money -- they were bagmen for Hamas. Money collected in the United States was transported by them to finance Hamas activities in the West Bank primarily. And this was not the extent of it. Now this country has a very elaborate network of -- an intelligence community, law enforcement agencies -- I know that they are engaged in dealing with that. this is an American issue and we are satisfied that the U.S. authorities are doing what they need to do in order to deal with any threats of this kind on American territory.

Q: But specifically there was a statement that they were being trained to make bombs in the United States. Do you have any information on that?

AMB. RABINOVICH: I think that was the case in the past, I think that particular venue was treated at that time, and I think awareness in this country by the relevant authorities to the threat of Hamas activities or the activities of other, similar organizations has been raised, certainty since the twin tower incident and other incidents of that time.

Yes, please?

Q: Yes. Beyond Iran, what countries provide sustantial financial and political support for Hamas? What other countries need to curtail their activities involving Hamas?

AMB. RABINOVICH: I think that speaking in state or government terms Iran is the address. There was a time in which the government of Sudan came under Iranian influence and cooperated with Iran -- I think that there's been a decrease in that respect. What you also have is the case of wealthy individuals in Gulf countries who have been contributing to Hamas.

This is not government activity, but we have expressed a concern, and I believe the U.S. government has done more than that, in order to persuade those Gulf country governments to prevent their citizens, their wealthy citizens, from passing on financial support to Hamas and to similar organizations.

Q: What are the Gulf countries?

AMB. RABINOVICH: I think several Gulf countries. I don't think I want to single out a particular Gulf country, among others.

Yes, please?

Q: After the London bombing this summer, I believe when Prime Minister Rabin was here, he said although Syria may not have been behind the bombings, they certainly had the power to stop the bombings. Is that a theme that's shared now, with the Hamas attacks over the weekend?

AMB. RABINOVICH: No, the bombing was a Hezbollah-Iranian operation, and Syria, wielding such influence as it does in Lebanon, is in a position to increase the pressure on Hezbollah and I think the question regarding the demarche made by the U.S. ambassador in Damascus has that in mind.

Hamas is not a Syrian-oriented movement, it draws its inspiration from Iran, and this is the principal address with regard to the recent wave that I spoke about earlier.

Q: Mr. Ambassador, is there a shift in tactics here? Two of the three recent attacks were within Israel proper. I mean, I could ask you a lot of questions, but I'd appreciate your reflections -- you know, is Hamas now bolder, was there some sort of an unwritten, sort of -- I hate to use the phrase "gentleman's agreement" that put Israel itself off limits to a lot of groups? Because I remember Maalat (ph), but that 20 years ago. Is there some shift here? What is your assessment of what's going on?

AMB. RABINOVICH: No, I don't think that there ever was -- ever was any policy of sparing Israel of Israelis from these attacks. And in March '93, you remember, there was a knifing wave and a wave of attacks inside Israel that led to the closure, the first major closure of Gaza and the West Bank. The prime minister was here on a visit to the United States, cut it short then and went back to Israel to deal with the wave of attacks inside Israel. I think that if given the choice, Hamas prefers to attack inside Israel. It regards that as more effective as affecting the mood and attitude of the Israeli population. But they are not very choosy. If they can hit Israelis or Jews in the West Bank or if they can operate abroad, they would, and they take explicitly pride in that, if you read their communiques of this very day.

Yes, please?

Q: Will closure of the West Bank and Gaza be carried out due to this incident?

AMB. RABINOVICH: Yes, it's been decided on as one in a series of measures designed to, first of all, limit the capabilities. There's no question that closure physically prevents individuals who either carry knives or carry explosives from entering Israel and limits their ability to act. Closure is not a root -- doesn't treat the roots of the problems, but it's a very effective technical measure of limiting if not preventing such activities. But it is only one of a series of measures.

Yes, please?

Q: Within hours of the attack, Bebe Netanyahu was on the air assailing the government's policies and saying that it's a demonstrative failure. How precarious is the peace process within Israel?

AMB. RABINOVICH: I think the peace process as such is not precarious. I think the majority of the Israeli population are supportive of the peace process. The recent initialling of a peace treaty with Jordan and the signing next week will enjoy a great deal of support. Mr. Netanyahu himself and his party have been supportive of peace with Jordan. And peace needs to be seen in an integrated way; you cannot be choosy and say, "I like this part of the peace process, I like a different part of the peace process less."

I think that the statements that were made under the immediate impact of really a very grim and tragic incident need not be seen as definitive positions. We all hope that we will not be swept into an international Israeli debate. Israel, as a society and as a country, needs all the cohesion and strength it can muster at a time like this. The government has not responded, has not attacked or criticized the opposition, and I hope that we all will rally in order to fight the real enemy, namely, this type of terrorism.

Q: Thank you very much.

AMB. RABINOVICH: Thank you very much.