MR. GAL, Moderator: Okay, ladies and gentlemen, good afternoon and welcome to our concluding press briefing. With us today, from right to left, and not necessarily by political inclination -- (laughter) -- Mr. Uri Lubrani, the co-chairman of our delegation to the talks with the Lebanese, Mr. Eli Rubinstein, chairman of our delegation to the talks with the Jordanian-Palestinian delegation, and Ambassador Shoval, Zalman Shoval, Israel's ambassador to the United States.

We'll start with some opening remarks and later we'll take your questions. We'll start with Ambassador Rubinstein. Eli, please?

MR. RUBINSTEIN: Good afternoon everybody and thank you for taking the time to come. We are about to conclude this round of negotiations. I'll talk about the Jordanian-Palestinian negotiations. And as you all know -- but we are still having one meeting this afternoon with the Palestinian side of the Jordanian-Palestinian side of the delegation.

This is a special negotiations because of the complexity of the issues, because of the emotions involved, the history of the conflict, its being a first-time negotiation of its type, and, frankly, the media -- the role of the media, which in my -- when there's an overlapping between the negotiations and what's being said outside and the penetrating of media matters into the negotiating room, it is not our style. It's definitely not my style. It's quite problematic in terms of the negotiations with the Palestinians, in particular, less with the Jordanian-Israeli track.

In the -- we had today what's known as a general meeting, the two tracks together with us. We discussed the question of venue of the negotiation. You've been hearing about it for a while. And we would like you not to be hearing about it any more, which means that this will be settled. And in fact, as you know, the administration has requested all delegations to submit lists of preferred venues closer to the region, and we do need that because of consultations, because of the efficiency of talks hasn't been achieved yet because of the refusal so far of the Arab delegations to submit their lists. And it's a fair proposal. What you do is compare the lists, put one on the other, see what's overlapping, and go ahead. So, there's been no response so far. We hope this will be resolved. It's necessary from the point of view of the negotiations themselves.

We also would like to have a response on our request and hope that there will be direct contact between us and our counterparts in a reasonable way between rounds of talks. Again, on this, we still await a response. We discussed this in our general meeting in the two tracks.

As far as the negotiations with Jordan, in the Israel-Jordan track, as you may have heard, we have exchanged during this round drafts for common agendas or agendas, trying to bridge the gap on the agenda. This has not yet been finalized. There are very significant gaps on (one side ?), but there also are areas of commonality, and we hope to be working on them. The atmosphere is a good, businesslike atmosphere. And it includes also informal exchanges between our experts and their experts on areas like water, economy, energy.

So, there is an atmosphere of negotiations. We understand their constraints. We hope they understand ours. And we -- the constraints, which have to do with considerations which are not only in the negotiating room, but beyond it, we understand them. We would like to make progress as soon as possible. We hope we can do it in the next round. In any case, the atmosphere is an atmosphere of negotiations and of a positive character.

In terms of the Palestinian side and the negotiations with the Palestinians, we, as you may have heard, submitted ideas which seem to us reasonable, answering the -- responding to the rules of these negotiations. And we have identified a long number of spheres and powers and responsibilities for the interim self-government arrangement that we should discuss. In fact, we brought with us experts who explained and introduced some of these subjects, like economy, commerce, industry, marketing -- (inaudible) -- health, et cetera. And the list is long.

But, so far, what we got from the Palestinians, and that's saddening from our point of view, is, in fact, a plan for a Palestinian state in all but name, and this is not what we -- the negotiations are about. We only want to plead that the negotiations would focus on what can be achieved, an interim self-government arrangement, and the possibilities are there. And, well, there are gaps between our positions. We would like them to work with us in identifying those areas which can be worked on and this is important. There have been also emotions and we didn't like, as you may know, some of the utterances and language but we wouldn't like to respond in kind and we will stay where we are in this respect. But just to wrap up and not to monopolize the time in any way, we want to continue to talk and to negotiate in both tracks, in the general meeting, everywhere, the time was not wasted, was not wasted. You're professional people, all of you, you know how painfully slow this thing can be and you don't measure the progress in miles. You sometimes measure it in much smaller measurements and ups and down will occur -- hopefully more ups than downs -- but you be aware of the fact that what sounds like procedural matters, agenda and so forth, is not procedures it is substance and we are there and we are working on it and as far as we're concerned we are ready to have another round soon and to continue our deliberations.

I think that will take care of my opening remarks. Thank you very much.

MR. GAL: Dr. Yossi Hadass has joined us. He is co-chairman of our delegation to the talks with the Lebanese and he'll make some comments. Please.

MR. HADASS: It's our third round in Washington with the Lebanese. We know for the time the respectful position of each one, of each side. We have conveyed to the Lebanese delegation that Israel remains firmly committed to the achievement of a peace treaty and in this round of talks we have focused on the problems of security along our northern border and presented practical proposals to resolve the questions of both substance and procedure. In the area of security, we emphasized two issues which are of a special source of concern to us: Terrorism from Lebanese territory undertaken by Hizbullah, by Palestinian organizations and by some small Lebanese organizations. And we have demanded, and we are going still to demand, that Lebanon put a halt to terrorist activity from its territory.

And the second issue was the military and security threats which are of us of a lot of concern. I mean, Syrian presence. There are today 35,000 Syrian soldiers on Lebanese territory and around 800 members of the Iranian Revolutionary Guards which train, assist, provide military arms to the Hizbullah and other groups in mainly the Beka'a valley, which is controlled, by the way, by the Syrian Army in Lebanon.

Unfortunately, the Lebanese delegation didn't accept our proposal or different proposals, including the establishment of two working groups, one on security and second one on civilian affairs. They have even refused to formulate with us a common agenda or to try to define problems, topics on which we agree, and others on which we disagree, to enable us to enter into concrete negotiations or discussions, to try and reduce as much as possible the gap between ourselves and Lebanon.

We are aware of the constraints and difficulties to which the Lebanese delegation is subject, both internally and externally. But we have tried to make them understand, as we made if very clear to them that no element outside the framework of the bilateral direct negotiations can or will be permitted to impose its views upon both parties.

Thank you.

MR. GAL: Thank you, Yossi. Mr. Lubrani.

MR. GAL: Okay, Mr. Lubrani will be available for questions later. I now turn to Ambassador Shoval for some concluding thoughts and remarks on the whole process.

AMB. SHOVAL: Each of my colleagues reported about his negotiations with the counterpart delegation. My counterpart delegation is the Americans, but this is not part of the process.

I think that what characterizes the spirit of negotiations of all the Israeli delegations in this round of talks is the positive attitude we have taken. And I'm glad to say we met -- the heads of the delegations and myself -- we met the Secretary of State this morning, and I don't want to talk on his behalf but I would say that that characterization of the positive attitude of the Israeli delegation was certainly not only our own view.

I would like to reiterate what Ambassador Rubinstein has said about the positive, promising atmosphere in our negotiations with the Jordanians. I won't go into detail, but I think there is certainly hope and scope for progress. With regard to the Palestinian side in the Jordanian- Palestinian delegation, we find their attitude sometimes rather perplexing. We don't really know if they want to achieve progress or if they want to talk to the media. There's nothing wrong talking to the media, but one should have one's sights on the main interest involved, and the main interest should be making progress on interim self- government arrangements. That's the name of the game of this stage of the peace process.

They may have problems, which I don't want to go into. But we certainly hope that at the next round -- and there may be another round, perhaps even two rounds during the holidays, after the holidays. There's the Moslem holidays, there's the Jewish holidays, there are the Christian holidays. We are in the holiday season. I hope that we shall make progress all the same.

Thank you.

MR. GAL: Thank you. We'll take questions. Barry, please?

Q: Just coming from the Palestinian briefing, the Palestinian spokeswoman said that the Palestinians would begin to implement their plan in at least -- in a minimal way whether or not Israel accepts their plan. Pressed for examples, she really said she didn't want to give any, but ultimately she spoke in terms of making arrangements for the elections. I suspect she means determining who is eligible to vote and making lists of voters. Is there an Israeli response to the notion that the Palestinians might initiate on their own at least the first steps of their plan?

MR. RUBINSTEIN: We never heard of this. This is the first time I heard about it. I can say that the -- one obvious thing could be if they want to talk to us about the details of the negotiations -- and I'm not speaking particularly of this example, but any other thing -- they can talk to us. We don't hear them between the rounds and we have the problem in communicating from this point of view. We would urge them -- and we urged them to communicate with us between the rounds and see -- this is not to say that there's any agreement on our side to their proposal which, as I said, is full-fledged almost. Palestinians say this is not acceptable and everybody understands why.

But communicating with us would be a first step to some dialogue between the rounds, because we never heard of this kind of an idea. And so before we do this kind of thing or agree to them, we have to hear what they mean and talk to them.

Q: I think -- just to follow up quickly, if I didn't misunderstand her on that either, she said there was no need for direct channels. I think maybe she's talking about what you're talking about is bilateral talking between rounds.

MR. RUBINSTEIN: Well, it's with us that the negotiations have to be conducted. With all respect, if somebody thinks that there'll be some deus ex machina or some emissary from heaven or from some place to take care of the negotiation, that's wrong. The negotiations are with us. That's with us that they have to live, and we want to coexist and live with them. So talk to us, and then before mentioning that this or that is going to be done, you have to agree on what has to be done.

MODERATOR: Yes, please.

Q: In summing up, Mr. Rubinstein, do you -- did you say that the plan you have submitted to the Palestinians, and the Palestinians have submitted to you, in spite of the flaws each of you find -- have they become a basis for discussion and negotiation?

MR. RUBINSTEIN: First of all, we have not submitted a full-fledged model. We have submitted a concept which included a lot of the elements of our -- our ideas, but some has to be developed, including in the negotiations, like the modalities -- (inaudible) -- their elections, and what elections, and how and so on. This has to be agreed and that -- a basis for negotiations must be something that addresses the process.

What we got from them so far -- and I'm saying it -- (inaudible) -- that way and with regret, is not a concept of interim self-government arrangements, but really, I have to repeat it, a Palestinian state. >From our point of view, you know the security aspects and all the other vital national interests that are invoked, this is not something which one can put on as a basis for negotiation. Let's get to the ground, which means to the ground rules of the process, and to the essence of the negotiations. This is interim self-government arrangement. Here there are (X ?) spheres which now are under Israeli civilian administration in the military administration framework. These areas have been offered to be negotiated and to be delegated or moved to the Palestinians with all kinds of coordination and cooperation, caveats and so on. But it's a very major list. Let's talk about it I submit this way: instead of trying -- the major gaps may not be bridgeable at this point, but there may be a gap that should be bridgeable, so let's take those areas which in any way would have to be negotiated. For instance, those spheres -- economic spheres, the social spheres, the -- all other spheres that I have tried to enumerate, and if we could number it, I think it has been mentioned here before -- and talk about them, because in any case they should be in any form you shape the negotiations.

We look forward for their response to this notion.

Q: If I could follow up on that.

MR. GAL: Oh, go ahead sir.

Q: I just want to follow up. I know that the Palestinian state is their goal, you have a different goal at the end. But in the interim are there no points of commonality in your outline or their plan on which you can begin discussions as to some of the things that you want to talk about such as administration, the economics -- the administration of the territories?

MR. RUBINSTEIN: I think that they -- in my humble view, they should take a good look at our ideas and should revise their plan not to accommodate us only because this is a negotiating process, you want to narrow the gap, but to accommodate the process in terms of government arrangements. So if this is a state which has a legislative and executive and a judiciary and the foreign relations and all kinds of other things, what is there almost to negotiate about? That is not a (concept ?). They should take a good look at our proposal and should -- I think from their point of view if they want to achieve -- one of them said the other day, the choices between one and the other thing -- we said to them the choice is really between peace and nowhere, so let's go for peace.

Q: (All their answer ?) were the same thing. I mean Mr. Rubinstein you said that your ideas, what you submitted were more or less preliminary ideas, I mean they are not the final plan. when the Palestinians offered you detail, I mean they might have wanted to offer you detailed ideas or detailed steps to implement these ideas but in their own -- from their own perspectives, why don't you look upon this also as a negotiating platform, both of them on the table and negotiate?

MR. RUBINSTEIN: It's simple, the -- and really I -- it's not my personal style and I think my government's style to negotiate through the media. We meet with them in half an hour, we'll tell them what we have to say about (these things ?). I certainly believe in the confidentiality of the process and (the free exchange ?) rather than through the media, but in order to serve as a basis for negotiations. First of all something should be given to us and not to the media -- at the same time as to make it a media exercise rather than a negotiating process.

So, we would like this to be -- when you look into it, really you -- one can always put the sky as the goal and then start from that. Now, let's not put the sky as the goal, and that is the problem.

MR. GAL: Ralph?

Q: I'd like to ask, if I could, two questions that are not really directly related. Number one, I suspect the answer will be brief. Can you tell us, Eli, whether your negotiations at all with the Palestinians in any way, shape or form involve discussion by your side of the delegation of the issues of settlements or of military activities in the territories and so on? And my other question is, I guess, for Ambassador Shoval. In the meeting with Secretary Baker today, have you discussed the loan guarantee issue, and are you any closer to resolving that between Israel and the United States than you were, let's say, yesterday?

MR. RUBINSTEIN: On the first question, they have been raising the settlements, as you know, wherein they made it, as I said before, the choice between settlements and peace, and we said no, the choice is between peace and (nowhere ?) if the roads are -- if that's the road you want to choose. Practically speaking, this is not part of the negotiations, from our point of view. And it's been, by the way, highly and widely exaggerated on this subject. Between what's there and between the pumping up of the subject, there's a big gap. But on the other point that you mentioned, the question of hat's going on in the territories, let me tell you something. They come every day, and I regret it again because that's not what I'd like to see in negotiations, and read us a collection of newspaper clippings or something like that which -- on human rights in the territories as a daily report. We said to them a number of times, time and again, publicly and privately, if you're really interested not in a media exercise of -- (inaudible) -- being distributed but to talk to us about these things, despite the fact that they are not a direct part of the negotiation, here we are, (General Rothschild ?), who is the coordinator of the territories, is a senior member of our delegation, myself. Talk to us seriously. If you think this or that thing needs fixing, we'll address it. We're here to talk to you and in a free way as equal human beings. Why not do that, and you can do it here, you can it when we are back home in Jerusalem. And just pick up the phone and say, "Listen, we think this or that is not proper and let's talk about it." We are there.

So, here is the answer to the second question. Unfortunately, it hasn't been taken (up ?).

But I do want to underline, really, I'm not complaining. We understand that the negotiating process is tough and difficult and it should continue, and we are here to help it continue in a continued way, in a positive way. All I am saying is that if we could really have the negotiations in the negotiating room in the proper atmosphere, I think much, much, much could be achieved, and I'm still looking forward to this kind of a possibility. I think the potential is there.

Q: Is it accurate to say, then, on the basis of that answer that your side -- my question was about what did your side of the delegation do on that issue, and the answer is what you have told the Palestinians is talk to us in another forum about those issues?

MR. RUBINSTEIN: Not another forum. Even in this forum.

Q: Have you -- have you -- has the Israeli delegation addressed the Palestinian concerns on those issues in a substantive way in these venues, in these talks?

MR. RUBINSTEIN: There was no -- there was no -- unfortunately, as I said, on these human rights things, there was no effort to address us or to talk to us on these things. There was an effort to read to us reports on what they think is taking place daily. And we tell them, with respect, if you want to talk to us, here or in Jerusalem, raise concerns -- they said we're not interested. I am saying it with regret, because here we are, serious people, experienced in negotiations, want to come and talk about these things, and we look forward to their working with us on that. That's all.

AMB. SHOVAL: With regard to the loan guarantees, Ralph, the matter came up very marginally. The Secretary wanted to reiterate once again that what he had said or what he had been reported to have said, the matter of the scoring only would refer to economic aid, only the scoring. And even on that, it was clarified that Israel may prefer to pay that in a different way, perhaps in cash, and not to be deducted from the economic aid whatsoever. He wanted to clarify that once again.

Q: And when you say -- when you use the word "reporting," you're referring to Senator Leahy's public statements, right?

AMB. SHOVAL: I saw something in the papers. I don't want to attribute it to anybody, but --

MR. GAL: We have three or four minutes because we have to rush back to the State Department. Alan, please.

Q: Can I ask, in your concept of self-rule, are you willing to discuss any change in the activities, the rights, the duties of the Israel Defense Forces? I understand that you want to keep security in your own hands, but are you willing to discuss anything that would make it seem less like an occupation and more like a self-rule in terms of the actions of the military?

MR. RUBINSTEIN: Well, one has to distinguish between two different things. One is the whole interim self-government arrangement would be a change because now this is under Israeli military administration, and it ought to be most of these spheres would be in Palestinian hands to run them. So, there will be, in this respect, a change, although the source of authority for the interim period should remain where it is now in order to keep all options open for the final status negotiations. As far as security as such, we are very serious on everybody's security, including ours, which means in terms of how security will be run, this responsibility should be ours.

By the way, this has been the concept all along. There's nothing new in that for the interim period, and we'll take care of our security forever because that's something which nobody would compromise. This country wouldn't compromise its security, nor would we. The negotiations should concentrate on the interim self-government arrangements for the Palestinians. This can be done.

STAFF: Two minutes remaining. Excuse me, last -- short one only. Short question, short answer. Please?

Q: Two short questions, if I may.

STAFF: One, one, one.

Q: One is if there was any kind of -- any element, anything of the Palestinian proposal that you found yourself agreeing to, anything which is -- that you agreed to, and the second half is if you agree to the timetable which says that the interim arrangements should be implemented no later than the end of October?

MR. RUBINSTEIN: I don't want to go into details of the Palestinian proposal. I said that a problem with it is in its basic concept, and we're going -- I, really, being a negotiator, I'm going now to see them. I'll leave it to my discussion with them to explain to them our problems. But this has all been in the newspapers before we even had the time to look into it and talk about it. I'll just say that the problem is with the very concept, and everything derives from that.

STAFF: You have all been very patient and very kind. Thank you very much.