Fears for Israeli coalition deal

The leader of an ultra-nationalist splinter group took a step closer to becoming Israel’s foreign minister today.

The leader of an ultra-nationalist splinter group took a step closer to becoming Israel’s foreign minister today.

Prime Minister-designate Benjamin Netanyahu signed a coalition deal with Avigdor Lieberman who heads the right-wing Yisrael Beitenu party.

Mr Lieberman has been accused of racism for proposing that Israel’s Arab citizens sign loyalty oaths or lose their citizenship.

The European Union urged Mr Netanyahu to create a government that embraced an independent Palestinian state living side by side with Israel – signalling Mr Lieberman’s appointment would be seen as a setback to Middle East peace efforts.

Mr Lieberman’s deal is not yet finalised, however. A spokeswoman for Mr Netanyahu’s Likud party said the coalition agreement included a provision that both sides were prepared to form a government that would include moderate partners, such as the Kadima Party of the current foreign minister, Tzipi Livni.

That wording left a door open for Ms Livni to retain her current job if she were to join such an alliance.

Ms Livni confirmed that MR Netanyahu had resumed overtures to recruit her in recent days, but said their talks had failed to sway her. She has said she would only serve in a government that is committed to a peace agreement.

She said that while she was prepared to join Netanyahu as an equal partner, she would not serve in order to lend legitimacy to an alliance with Mr Lieberman and other hawks.

The agreement with Yisrael Beitenu is the first Mr Netanyahu has initialled on his way toward setting up a coalition of hawkish and Orthodox Jewish parties.

The government taking shape would take a harder line on Palestinian and Arab issues than the outgoing administration of Prime Minister Ehud Olmert.

Mr Netanyahu has criticised last year’s peace talks between Israel and the Palestinians, aimed at partitioning the land and establishing a Palestinian state. The talks made little progress.

He favours focussing on efforts to bolster the Palestinian economy, leaving issues like borders, sovereignty and Israeli settlements for a later stage. In defiance of Israeli commitments to international plans, Mr Netanyahu wants to expand Israel’s West Bank Jewish settlements to allow for “natural growth,” accommodating the growing families in the communities.

Palestinians reject that approach and have the backing of the new Obama administration. In a recent visit, Secretary of State Hillary Clinton said the goal of negotiations must be the creation of a Palestinian state living next to Israel in peace.

Mr Netanyahu still needs to add several other parties to reach a majority in the 120-member parliament. In the election last month, Likud won 27 seats, and Yisrael Beitenu adds another 15.

Kadima won 28 seats, but Mr Netanyahu was chosen to form a government because a majority of members of parliament said they favoured him over Ms Livni as premier.

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