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Publisher\Editor Don Canaan

                       July 24, 1996 V4, #134
All the News the Big Guys Missed

German In-Between Believes Ron Arad is Alive

By Kyle King (VOA-Bonn)

The German intelligence official who helped broker an exchange between Israel and the pro-Iranian Hizbullah, says he believes missing Israeli airman Ron Arad is alive.

The German government's intelligence coordinator, Bernd Schmidbauer, says he has indications that would justify the impression Ron Arad is still alive. The Israeli air force navigator has been missing since 1986 when his plane was shot down over southern Lebanon.

In an interview with the newspaper Bild, Schmidbauer says the missing flyer's daughter is now 10 years old and she should get her father back. Israel, which believes the missing airman is still alive, has asked Schmidbauer if he would look into the case.

Sunday, a deal brokered by Schmidbauer resulted in the return of the remains of two Israeli soldiers in exchange for the remains of more than 100 Hizbullah fighters and 45 prisoners held by the Israeli-backed south Lebanon army militia.

In the interview, Schmidbauer again defended his government's controversial policy of maintaining friendly relations with Iran. The United States, which has sought to isolate Iran because of its support for terrorists, has been critical of the German policy.

Arafat Meets With Foreign Minister David Levy

By Patricia Golan (VOA-Jerusalem)

Palestinian President Yasir Arafat and Israeli Foreign Minister David Levy have held talks in the first meeting between the Palestinian leader and a minister of Israel's new right-wing Israeli government. The two men agreed on further Israel-PLO contacts, in hopes of continuing the peace process.

Peace talks between Israel and the PLO have been suspended since the May 29th elections. Prime Minister Benjamin Netanyahu's hard-line Likud party opposes the self-rule agreement with the Palestinians signed by the previous Labor-led government, but last week, the Israeli prime minister said Israel would implement existing agreements.

The chief importance of the meeting between Levy and Arafat was that it took place. Although Netanyahu has said that if the need arises he would meet Arafat, he has so far refused to hold talks with the Palestinian leader. The snub has been a source of anger and humiliation among the Palestinians.

The meeting between Levy and Arafat was historic from the point of view of Netanyahu's Likud party, which has consistently rejected Arafat's PLO's bid to represent the Palestinian people. Several of Netanyahu's Cabinet ministers have rejected any contact with Arafat. Before the elections, Ariel Sharon -- now the "infrastructure" minister -- called him a war criminal. Agriculture Minister Rafael Eitan said no one higher than border guard should meet with Arafat.

But judging from the meeting at the Erez border crossing between Israel and the Gaza Strip, the rhetoric of the Likud-Netanyahu election campaign is being overtaken by necessarily more conciliatory policies.

At a news conference following the meeting, Arafat said the two men had agreed to continue the dialogue between Israel and the Palestinians at all levels, and to find solutions to all outstanding problems. He said he expected the remaining elements of the autonomy agreement, including a partial Israeli troops withdrawal from the West Bank town of Hebron, to be carried out very soon.

Levy said they had reached an understanding to set up a framework for discussing problems, and said he encountered a profound desire for cooperation to continue negotiations on the peaceful relations that both sides seek.

Both sides have long lists of broken promises. The Israelis say Arafat's Palestinian Authority is operating illegally in Jerusalem and has failed to extradite to Israel Palestinian fugitives taking refuge in the Palestinian autonomous areas.

Arafat reportedly presented Levy with four central demands -- Hebron redeployment and the commitment to an additional West Bank withdrawal, renewed final status talks, Israeli commitment to terminate settlements, and the preservation of Palestinian institutions in east Jerusalem.

Though no details of the meeting have emerged, clearly it represents the revival of contacts with the Palestinian Authority and the Israelis ... and analysts say it may pave the way to a meeting with Netanyahu.

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