Surrounded by black-robed priests, armed guards and journalists, Yasser Arafat today ducked into the candlelit grotto marking the traditional birthplace of Jesus.

Palestinian gunmen wanted by Israel emerged from the Church of the Nativity today, marking the end of a tense five-and-a-half week standoff with Israeli troops at one of Christianity’s holiest shrines.

Italy threw a spanner in the works today just as Israel and the Palestinians agreed to terms for ending the 36 day siege of Bethlehem’s Church of the Nativity.