BETHLEHEM, West Bank -- The first direct negotiations to end a three-week stalemate between Israeli forces and armed Palestinians holed up in one of Christianity's holiest shrines ended Tuesday without an agreement, though both sides cited some progress and pledged to continue talking.
Prime Minister Ariel Sharon, meanwhile, told an American Jewish group he believed a U.S.-sponsored international peace conference could end Mideast hostilities. He credited the Israeli incursion into the West Bank with creating the climate for a settlement.
"Regional peace is within our grasp," Sharon said. "I am optimistic about the future."
Palestinians had been optimistic for a quick resolution in the talks to end the standoff at the Church of the Nativity. But the key dispute remained. Israel says wanted militiamen inside the Church of the Nativity must be tried in Israeli courts or exiled abroad; the Palestinians propose sending them to the Gaza Strip under international escort.
Several dozen Palestinian civilians, as well as priests and nuns, also are in the church compound, built over the grotto where tradition holds Jesus was born.
Palestinian lawmaker Salah Tamari, who participated in the talks, said both sides were determined to reach a peaceful solution. Israel, he said, had agreed to evacuate four sick people from the church compound. He did not say if they were civilians, armed Palestinians or the clerics who have been inside since April 2.
Talks will continue
"The meeting was positive and constructive, but we didn't reach any agreement," Tamari said.
Gadi Golan, head of religious affairs division at the Israeli foreign ministry, said he had not yet been briefed on the result of the day's talks, which were handled by an all-military team. Army spokes-man Lt. Col. Olivier Rafowicz declined to comment, and his office would only say progress had been made and talks would continue.
Bethlehem Mayor Hanna Nasser called the meeting "important." Tamari said the Gaza proposal "was discussed as an option." Beyond that, he would only say delegates needed to consult with the Palestinian leadership before talks resumed Wednesday.
Later Tuesday, an explosion rattled the Ramallah headquarters of Palestinian leader Yasser Arafat. Tawfik Tirawi, head of Palestinian intelligence, said Israeli troops tried to destroy a wall between the prison inside the compound and Arafat's office. The army said the blast was the controlled destruction of grenades found in the compound.
On the political front, a senior Israeli government official, speaking on condition of anonymity, told foreign correspondents Israel was interested in last month's Arab League peace initiative. The official said there was some hope the Arab world, negotiating on behalf of the Palestinians, would be more flexible than Arafat.
In March, the 22 Arab League nations adopted a Saudi initiative offering pan-Arab acceptance of Israel and with normal relations after Israel returns all Arab land seized in the 1967 Mideast war. The deal also requires Israel to accept a Palestinian state with east Jerusalem as its capital and an adequate resolution of the problem of Palestinian refugees.