Israeli minister rejects Solana's peace ideas

JERUSALEM (Reuters) - Israel on Monday rejected and the Palestinians welcomed a call by the European Union's foreign policy chief for U.N. recognition of a Palestinian state if negotiators fail to achieve a peace agreement.

"Peace must be built, not imposed," Foreign Minister Avigdor Lieberman told Israel Radio, asked whether remarks made by the EU's Javier Solana in a lecture in London on Saturday represented the policies of the European Union.

"With all due respect to Solana, he's about to retire ... and we should not overstate the importance of his statement," Lieberman said.

Solana said mediators should set a timetable for an Israeli-Palestinian peace agreement and "if the parties are not able to stick to it, then a solution backed by the international community should be put on the table."

After such a deadline passed, he said, "a U.N. Security Council resolution should proclaim the adoption of the two-state solution" and accept a Palestinian state as a full member of the United Nations.

Asked about Solana's proposal, chief Palestinian negotiator Saeb Erekat said: "We do not object. It's time for the international community to stop treating Israel as above the laws of man."

Israeli-Palestinian peace talks backed by a quartet of international mediators -- the European Union, the United States, the United Nations and Russia -- are frozen.

Palestinian President Mahmoud Abbas has said he will not revive the negotiations unless Israel halts settlement expansion in the occupied West Bank, in accordance with a 2003 peace "road map" that also commits the Palestinians to rein in militants.

Israeli Prime Minister Benjamin Netanyahu has said he wants to shift the focus in talks with the Palestinians from tough territorial issues to a "triple track" on improving political, security and economic relations.

Netanyahu met Quartet envoy Tony Blair on Monday to discuss ways to improve the Palestinian economy.

Netanyahu's office said in a statement the talks covered "efforts and decisions being made to accelerate the economic development in the area ... and to provide relief to the Palestinian residents."

U.S. President Barack Obama's Middle East envoy, George Mitchell, was due to return to the region soon, U.S. officials said, for further talks with Israel on ending a rift with Washington over halting construction within settlements.

No date has been announced for the visit, but Erekat said Mitchell would arrive in 10 days.

(Additional reporting by Mohammed Assadi in Ramallah and Anne Jolis in Brussels; writing by Jeffrey Heller; editing by Tim Pearce)