Netanyahu firm on settlements before U.S. visit

Israel's Prime Minister Benjamin Netanyahu attends the weekly cabinet meeting in his office in Jerusalem March 21, 2010.

JERUSALEM (Reuters) - Prime Minister Benjamin Netanyahu said Sunday he had told Washington in writing, just before heading for talks with U.S. President Barack Obama, that Israel would not stop Jewish settlement around Jerusalem.

The settlement issue, accompanied by mounting violence in the occupied West Bank, where Israeli forces have killed four Palestinians in two days, is challenging renewed efforts by U.S. envoy George Mitchell to get peace talks under way.

"Our policy on Jerusalem is the same policy followed by all Israeli governments for the 42 years, and it has not changed. As far as we are concerned, building in Jerusalem is the same as building in Tel Aviv," Netanyahu told his cabinet Sunday.

"I believed it would be of great importance for these things not to remain in the context of commentary or speculation. I subsequently wrote a letter, at my own initiative, to the secretary of state so that things would be crystal clear."

U.S. Secretary of State Hillary Clinton and Netanyahu spoke by telephone Thursday in an attempt to defuse a vocal U.S.-Israeli dispute over settlement in areas around East Jerusalem, captured by Israel in 1967.

Israel's announcement -- during a visit by Vice President Joe Biden two weeks ago -- that it would build 1,600 homes for Jews near East Jerusalem embarrassed Washington and stymied the start of indirect peace talks with the Palestinians.

Netanyahu was flying to Washington Sunday after meeting Mitchell. He is to address the pro-Israel lobby group AIPAC on Monday, and an aide said he would meet Obama Tuesday.

Clinton last week gave the first sign of a softer U.S. tone, saying Netanyahu had made "useful and productive" comments.

She gave no details. Israeli media said Netanyahu had refused to shelve the housing project, but had agreed to confidence-building steps such as freeing Palestinian prisoners and easing a blockade of Gaza.

In the latest West Bank bloodshed, Israeli troops killed two Palestinians who tried to stab soldiers, the army said.

Palestinian officials cited witnesses alleging the men had been killed in cold blood after being arrested.

Saturday, soldiers shot two Palestinian teenagers during a stone-throwing protest against Israeli settlement policy. One died immediately and the other died of his wounds Sunday.

The Palestinians said live ammunition had been used but the Israeli army said it had been using rubber bullets.

FREEZE DEMANDED

The Palestinians were sticking publicly to their refusal to restart talks until Israel freezes settlement building.

Nabil Abu Rdainah, an aide to President Mahmoud Abbas, said Israel was thwarting efforts by the quartet (of international mediators) and the United States to revive the peace process.

In his remarks at the weekly cabinet meeting, Netanyahu appeared to give Mitchell an opening by addressing a Palestinian demand to negotiate core issues, such as borders and the future of Jerusalem, during indirect peace talks.

Netanyahu reaffirmed that each side was free to raise any issue, but said pointedly that "a real solution to the core problems ... can be reached only in direct peace negotiations."

Netanyahu has apologized to Washington for the timing of the announcement of building plans for Ramat Shlomo, built on West Bank land that Israel unilaterally annexed to Jerusalem.

But he told parliament last week there was a national consensus to build in "Jerusalem neighborhoods."

"Israel's position is very clear," Netanyahu told his cabinet, which comprises mainly pro-settler parties. "It will be clear during my visit to the U.S. capital."

Friday, the "quartet" of United States, European Union, United Nations and Russia urged a halt to all settlement building.

(Editing by Kevin Liffey)