U.S. sets new Israel meeting, presses Arabs to help

By Alastair Macdonald and Dan Williams

JERUSALEM (Reuters) - U.S. President Barack Obama's envoy will hold a second meeting in a week with Israel's defense minister, an Israeli official said on Friday, announcing talks on Monday likely to focus again on a dispute over settlements.

A senior U.S. official confirmed to Reuters that Washington is asking Arab governments whether they might ease sanctions on Israel if it freezes Jewish settlement on Palestinian territory, a move that could lead to regional peace negotiations.

The U.S. State Department had no immediate comment.

But Arab leaders have so far been cool, Western diplomats said, to suggestions they might open their airspace to Israeli airliners, allow roaming calls by Israeli cellphones or let in tourists whose passports show they have also visited Israel.

Israeli Defense Minister Ehud Barak will meet Obama's Middle East envoy George Mitchell in London on Monday, six days after their meeting in New York on Tuesday, an Israeli official said.

No details on the agenda were immediately available. Israeli Prime Minister Benjamin Netanyahu has, since taking office four months ago, been resisting U.S. pressure to halt expansion of West Bank settlements to unblock peace talks with Palestinians.

After last meeting Mitchell, Barak made a link between a settlement freeze and progress on Arab states "normalizing" relations with Israel, which is isolated by its neighbors.

On Friday, a senior U.S. official told Reuters: "We are trying to get the Arab states, in the context of meaningful action by the Israelis, to take steps toward normalization."

Mitchell aimed to foster negotiations: "To do that, we want all the parties to live up to their obligations," he said -- Israel should halt settlements and Palestinians should do more to curb security threats and incitement against Israel, while Arabs states would make some conciliatory gestures to Israel.

Such moves could be announced simultaneously, he added.

ARAB CONCESSIONS?

Arab gestures could include letting Israeli airliners fly over their territory, saving long detours on flights to Asia, and allowing Israel to open interests sections in other states' embassies in Arab capitals, such as Riyadh and Abu Dhabi.

Also discussed in U.S. overtures to Arab governments that have been supported by other members of the Quartet of mediating powers were ending the blocking of Israeli-registered cellphones on Arab networks and lifting bans on entry to tourists and other visitors whose passports carry Israeli visas or entry stamps.

The U.S. official said Washington was also suggesting direct meetings between senior officials and cultural exchanges:

"The idea has always been to have a set of simultaneous actions that could be (announced) on one day, either through press releases in different capitals or at a meeting ... that the Israelis will announce meaningful action on settlements, the Palestinians will (take meaningful steps) on security, and the Arabs will announce some steps toward peace."