The New Nation - Internet Edition

AFP, Salvador

Israeli settlement expansion on Palestinian territory must stop immediately, President Luiz Inacio Lula da Silva said Friday as he seeks to position Brazil as a player in the Middle East.

"The expansion of West Bank settlements must be frozen," Lula said after meeting for two hours with Palestinian leader Mahmud Abbas.

"The borders of the future Palestinian state should be preserved, and freedom of movement needs to be guaranteed in the occupied territories."

For his part, Abbas blasted Israel's decision to pursue settlement activity as an "obstacle on the road to peace" in the Middle East.

He noted that under the US-backed 2003 roadmap, a peace plan that calls for a Palestinian state living side by side with Israel, the Jewish state is required to freeze all settlement construction.

The roadmap also demands that Israel dismantle all settlement outposts, or dwellings the state itself considers illegal.

"Therefore if the Israeli government continues to build, notably in occupied east Jerusalem, that will mean it is erecting obstacles along the road to peace," Abbas said.

The Palestinian leader called on Lula, who met last week with visiting Israeli President Shimon Peres, to play a greater role in international efforts to reach an agreement on Middle East peace.

"We appreciate the efforts of Brazil," Abbas told reporters in the northeastern city of Salvador.

"With respect to you, President Lula, we would like you to have a role, and you're ready for it," he said, adding that "the world can benefit from" Brazil's influence in the region.

The two leaders discussed the long-stalled Middle East peace process and a way forward for the Palestinian territories.

"The peace process will benefit from the contribution of other countries other than those traditionally involved" in negotiation efforts, Lula said.

In recent weeks, Brazil has hinted at ambitions to play a role in Middle East affairs as the country seeks to boost its international profile to match its growing economic heft.

After Peres and Abbas, Lula is expected to meet Monday with Iranian President Mahmoud Ahmadinejad as part of a flurry of talks with Middle East leaders.

Another report adds from Morocco: Opposition chief Tzipi Livni reiterated her support Friday for a Palestinian state and the resumption of peace talks as she made a rare foray by an Israeli leader into the Arab world.

However, speaking at a forum in the coastal city of Tangiers devoted to conflict resolution, Livni said she would not countenance the establishment of a "terrorist" state as she also took aim at the Islamist movement Hamas.

"I believe we can put an end to the conflict based on a two-state solution", she said in comments translated into French, adding it was vital that dialogue between the two sides is resumed.

Livni said that the Israeli-Palestinian conflict was not about religion, regardless of the efforts of the Islamists of Hamas to portray it as such, but rather a nationalist struggle.

Hamas, which controls the Gaza Strip, has been behind scores of anti-Israeli suicide attacks and refuses to recognise Israel's right to exist.

Livni was formerly a member of Prime Minister Benjamin Netanyahu's Likud party which has traditionally been opposed to the creation of a Palestinian state being created alongside Israel.

Before her speech, Livni shook hands with Rafiq al-Hussaini, Palestinian president Mahmud Abbas's chief of staff who was also taking part in the forum.

Hussaini said the Palestinians "have no desire" for a conflict with Israel but said that peace negotiations could not restart "until Israel stops the settlements" on Palestinian territory, including annexed Arab East Jerusalem.

Livni did not meet any member of the Moroccan government during her visit to Tangiers and was due to return to Israel on Friday, according to organisers.

Morocco is one of the rare Arab countries to receive Israeli officials despite the absence of formal diplomatic relations. Egypt, Jordan and Mauritania are the only Arab states to have forged full diplomatic ties with the Jewish state.