Israel's prime minister on Thursday rejected U.S. calls to halt construction in disputed east Jerusalem, clouding a new peace mission by Washington's Mideast envoy.
Benjamin Netanyahu's comments were broadcast on Israel's Channel 2 TV shortly after envoy George Mitchell arrived for his first visit in six weeks. Mitchell's efforts had been on hold due to disagreements over east Jerusalem, the section of the holy city claimed by Israel and the Palestinians.
"I am saying one thing. There will be no freeze in Jerusalem," Netanyahu said. "There should be no preconditions to talks."
Although Netanyahu was repeating his long-standing position, the timing of the statement threatened to undermine Mitchell's latest efforts to restart peace talks. Mark Regev, an Israeli government spokesman, denied earlier reports that Israel had officially rejected an American demand for a settlement freeze in Jerusalem.
There was no immediate U.S. reaction.
Mitchell arrived after a month-long break sparked by a dispute over Israeli construction in east Jerusalem, hoping to prod the Israelis and Palestinians to launch negotiations for the first time in more than a year.
It was far from certain whether he would succeed, though Israeli and Palestinian officials both indicated that they were ready to get past the deadlock.
The sides were set to begin indirect peace talks in early March when Israel revealed plans to build 1,600 homes for Jews in east Jerusalem. The announcement, which came during a visit by Vice President Joe Biden, infuriated the Americans and prompted the Palestinians to postpone the indirect talks indefinitely.
The U.S. has been pushing Israel to cancel the planned housing project, halt other east Jerusalem construction and make other confidence-building measures to the Palestinians.
Netanyahu has repeatedly refused to curb Jewish construction in east Jerusalem, saying he is following a four-decade-old policy of his predecessors. Israel considers all of the city to be its eternal capital.
But in the TV interview, he said he hopes to resolve the differences with Washington, Israel's closest and most important ally.
"There are ups and downs. There is a very strong fabric of relations that will allow us to overcome these problems in the end and reach understandings," he said.
Israeli officials declined to say what gestures were under consideration. The government has debated proposals to free some of the thousands of Palestinian prisoners in Israeli jails, turn over more West Bank territory to Palestinian control and possibly curb Jewish construction in the heart of Arab neighborhoods in east Jerusalem.
Some 180,000 Israelis live in east Jerusalem, the vast majority in Jewish neighborhoods that ring the area. But an estimated 2,000 Israeli nationalists live deep inside Arab neighborhoods, creating friction between the sides.
An estimated 250,000 Palestinians live in Arab neighborhoods of the city. A halt to Israeli housing activity in these areas, while short of U.S. and Palestinian demands for a freeze in all of east Jerusalem, would nonetheless mark a concession by Israel.
Netanyahu would have a hard time selling even limited concessions to his government, a coalition dominated by hard-line nationalist parties.
"It is just impossible and unacceptable that people try to impress us that we should limit construction in Jerusalem," Benny Begin, a senior Cabinet minister, told foreign reporters and diplomats Thursday.
The status of east Jerusalem is the most explosive issue dividing Israelis and Palestinians. Israel captured the area — home to key Jewish, Muslim and Christian holy sites — in the 1967 Mideast war and immediately annexed it. The annexation has never been internationally recognized.
Mitchell arrived late Thursday for his first visit since the spat with Israel erupted during Biden's visit in early March. He was scheduled to meet separately with Netanyahu and Palestinian President Mahmoud Abbas on Friday.
Palestinian negotiator Saeb Erekat called the Netanyahu position on Jerusalem "very unfortunate" and said he hoped the U.S. "will be able to convince the Israeli government to give peace a chance by halting settlement construction in east Jerusalem and elsewhere."
Nonetheless, he left the door open to resuming talks. Asked if anything short of an east Jerusalem construction freeze would bring the Palestinians back to the negotiating table, he said it would depend on what Netanyahu told the Americans.
Another Palestinian official said Abbas planned to bring any proposal to the 22-member Arab League — a move that would give a stamp of legitimacy for restarting the negotiations. The official spoke on condition of anonymity pending a formal announcement.
Peace talks broke down in late 2008 after Israel launched a three-week military offensive in the Gaza Strip. The Palestinians have said they will not hold face-to-face talks with Netanyahu until he freezes all settlement activity in east Jerusalem and the West Bank. Netanyahu so far has curbed only West Bank construction in a temporary freeze.
The indirect talks, to be personally mediated by Mitchell, are meant as a way to break the deadlock.
Last week, Obama issued a surprisingly pessimistic assessment of peacemaking prospects, saying the U.S. couldn't force its will on Israelis and Palestinians if they weren't interested in making the compromises necessary to end their decades-old conflict.
AP Writers Ben Hubbard in Ramallah, West Bank and Steven Gutkin in Jerusalem contributed to this report.
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