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Settlements row to dominate US-led West Asian talks

US secretary of state Hillary Clinton was in Egypt on Tuesday to lead a second round of Israeli-Palestinian peace talks, aiming to prevent negotiations from collapsing.

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US secretary of state Hillary Clinton was in Egypt on Tuesday to lead a second round of Israeli-Palestinian peace talks, aiming to prevent negotiations from collapsing days after their launch.

Remarks by Palestinians and Israelis ahead of the talks in the Red Sea resort of Sharm el-Sheikh did not suggest a compromise was at hand to resolve a dispute over Israeli settlement construction in the occupied West Bank.

"Choosing to continue with settlements in any form means destroying the negotiations," chief Palestinian negotiator Saeb Erekat said.

Erekat was speaking after Israeli prime minister Benjamin Netanyahu said on Sunday he would not extend a partial building freeze, though he indicated he would curb future construction.

Clinton said en route to the talks the two sides must resolve their dispute over the end of the freeze on Jewish settlement building on land Palestinians want for a state.

"For me, this is a simple choice: no negotiations, no security, no state," Clinton said.

Netanyahu and Palestinian president Mahmoud Abbas kicked off the latest in a long line of direct talks in Washington at the start of the month, hoping for a deal within a year to end the decades-old conflict.

But the nascent initiative, driven by US president Barack Obama, could unravel almost immediately.

The Palestinians say they will quit the peace talks unless Israel extends its self-imposed moratorium on new construction in settlements when it expires at the end of September.

"Talks are a test of intentions if Israel extends the moratorium on settlements then that widens the margin of negotiations and we continue to negotiate," Mohammed Shtayyeh, a Palestinian delegate to the talks, said.

Allies of Netanyahu, whose coalition is dominated by pro-settler parties, warn of a government collapse if he fails to resume expanding the settler enclaves.

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