Israeli union leader wins Labour leadership contest

Fiery union leader Amir Peretz won a stunning victory today over elder statesman Shimon Peres in the race to lead Israel’s Labour Party – a vote that could bring down Prime Minister Ariel Sharon’s shaky coalition and propel the country into early elections.

The dramatic upset revolutionised Israel’s political landscape, with Peretz, a Moroccan immigrant whose father toiled in a kibbutz factory, taking over Labour, the bastion of Israel’s eastern European elite.

“This is the moment we bury the ethnic demon in Israel,” Peretz declared in his victory speech.

Party secretary Eitan Cabel, officially announcing Peretz’s victory, said the union leader captured more than 42 per cent of the vote, while Peres took just under 40 per cent.

Peres led Labour into the government this year to shore up support for Sharon’s Gaza withdrawal.

The pull-out divided Sharon’s Likud Party, and without Labour’s support, the plan could not have been carried out. Peretz says that with the withdrawal complete, Labour should quit to push an economic agenda.