Israeli PM hints at 'midway options' on construction freeze dispute

Israeli Prime Minister Benjamin Netanyahu on Sunday hinted that he may be willing to adopt "midway options" to solve the Jewish settlement construction dispute after the government's building moratorium expires later in the month.

Palestinian President Mahmoud Abbas has vowed repeatedly in recent weeks to quit direct talks, launched in Washington earlier this month, if construction activity in the West Bank Jewish settlements resumes.

While Netanyahu has not announced any binding decisions, the Israeli premier Sunday suggested a partial continuation of the moratorium.

"There's all or nothing, but there are also midway options ( regarding the construction freeze debate)," Netanyahu said at his cabinet's weekly session.

"I don't know if there will be a comprehensive freeze, but I also don't know if it is necessary to construct all of the 20,000 housing units waiting to be built -- between zero and one there are a lot of possibilities," Netanyahu was quoted by local daily Ha'aretz.

Netanyahu and Abbas are slated to meet on Tuesday for the continuation of talks in the Egyptian resort town of Sharm el- Sheikh, with US Secretary of State Hillary Clinton, US special Middle East envoy George Mitchell and Egyptian President Hosni Mubarak on hand. Both leaders will meet again the following day in Jerusalem.

US President Barack Obama on Friday moved to soothe tensions between Israeli and Palestinian negotiators in an effort to prevent a potential breakdown at the outset of talks.

"It turns out, to Netanyahu's credit and to the Israeli government's credit, that the settlement moratorium has actually been significant. It has significantly reduced settlement construction in the region," Obama told reporters on Friday.