Rice says time to tackle Lebanon-Israel border row

BEIRUT (Reuters) - U.S. Secretary of State Condoleezza Rice praised Lebanon's President Michel Suleiman as "a very fine man" on Monday and called for more U.N. efforts to resolve a dispute over the Israeli-occupied Shebaa Farms.

Rice, on a surprise visit to Lebanon, endorsed last month's Qatari-brokered agreement to end a political crisis that had led to a violent showdown between factions in the Western-backed government and the Hezbollah-led opposition.

She was the most senior U.S. official to meet Suleiman since he was elected following the deal in which the opposition achieved its longstanding goal of veto power in government.

Lebanese officials said her talks in Beirut focused on the Shebaa Farms, a sliver of land occupied by Israel in the 1967 war. Syria and Lebanon say Shebaa is Lebanese, not Syrian, as the United Nations designated it when Israeli forces quit Lebanon in 2000.

"The United States believes that the time has come to deal with the Shebaa Farms issue," Rice said after meeting Prime Minister-designate Fouad Siniora.

Suleiman and Siniora issued separate statements saying their talks with Rice had focused on the need for Israel to withdraw from Shebaa and allow it to be placed temporarily under U.N. supervision -- as the Beirut government has long advocated.

Any change in the U.N. stance that Shebaa belongs to Syria would put Israel under more pressure to leave the border area.

Majority leader Saad al-Hariri also requested Rice's help over Shebaa to "close that chapter in the history of Lebanon" and pave the way for "a long dialogue with our partners in Lebanon" -- meaning Hezbollah.

The Shi'ite group cites the need to liberate the pocket of territory as one reason it must keep its arsenal of weaponry.

LEBANON'S INTERESTS

Asked how Washington viewed Hezbollah's recent political gains, Rice said the Doha deal had served Lebanese interests.

"If it served the interests of the Lebanese people, it served the interests of the United States," she added.

Rival Lebanese leaders reached the agreement only after Hezbollah fighters overran much of Beirut in early May. About 80 people were killed in fighting in the capital and elsewhere.

"I know that it has been a struggle for Lebanon to get to the election of its president but I come away knowing that Lebanon has succeeded in selecting a very fine man and we look forward to working with him," Rice said after meeting Suleiman.

Rice wound up her one-day trip with a visit to Parliament Speaker Nabih Berri, a Shi'ite leader allied with Hezbollah.

Lebanon's parliament elected Suleiman on May 25, filling a six-month presidential vacuum. Siniora is now trying to form a unity cabinet in which the Iranian- and Syrian-backed Hezbollah and its allies will be able to block decisions they dislike.

Rice said the United States, which views Hezbollah as a terrorist group, would work with Lebanon's next government -- in which the political-military group is sure to be represented.

"It is up to the Lebanese people (to decide) the composition of their government," she said. "We hope that the government formation will proceed and proceed rapidly."

The United States has long accused Syria and Iran of meddling in Lebanon -- and denies that it does the same.

Rice said Syria and Lebanon should exchange ambassadors, demarcate their borders and deal with each other as equals.

U.S. pressure helped force Damascus to withdraw its troops from Lebanon in 2005 after the assassination of former Lebanese premier Rafik al-Hariri. Syria denied any hand in the killing.

It was Rice's first visit to Lebanon since the 2006 war between Israel and Lebanon's Hezbollah guerrillas.

Many Lebanese were angered by Washington's refusal to demand an early ceasefire in the conflict and derided Rice's view that the war was part of the "birth pangs of the new Middle East".

Asked if this had left any bad blood, she said: "Quite the contrary. The United States played a pivotal role in helping to end the war in 2006."

Rice had flown to Lebanon from Jerusalem where she was on her sixth trip to the region to try and nudge Israelis and Palestinians towards a peace deal by the end of 2008.

(Writing by Alistair Lyon; Editing by Caroline Drees)