Israeli warning over Gaza rockets

Israel's prime minister has promised an "uncompromising response" if rockets continue to be fired from the Gaza Strip into Israel.

Ehud Olmert said Israel's retaliation would be painful, harsh and strong.

His warning, at a cabinet meeting, came as international Middle East envoy Tony Blair visited Gaza to see the damage caused by Israel's recent offensive.

Meanwhile, Palestinian medics said five people had died when a smuggling tunnel under the Gaza-Egypt border collapsed.

Both Israel and the main Palestinian militant group in Gaza, Hamas, declared unilateral truces following Israel's three-week Gaza offensive on 17 January.

But a number of rocket strikes and other attacks from Gaza have been reported since then, apparently involving smaller militant groups.

Israel has responded with air strikes.

Tunnel collapse

Speaking at the start of his cabinet's weekly meeting in Jerusalem, Mr Olmert said: "If the rocket fire from Gaza continues, it will be answered with a painful, harsh, strong and uncompromising response from the security forces."

His warning came as diplomats from around the world prepare for a Gaza reconstruction conference in Egypt on Monday. Palestinians are seeking about $2.8bn in aid.

Outgoing Israeli Prime Minister Ehud Olmert (R) speaks to Foreign Minister Tzipi Livni
Mr Olmert said Israel's response would be "painful, harsh, strong"
Among those attending will be the new US Secretary of State, Hillary Clinton. She is then expected to continue on to Israel and the West Bank.

Meanwhile, former UK Prime Minister Tony Blair paid a brief visit to Gaza on Sunday, the first in his role as international Middle East envoy. Mr Blair, who will also attend the donor conference, met local businessmen at a UN school in northern Gaza and discussed the territory's reconstruction needs with them.

The former PM was not meeting any representatives of Hamas, which is regarded by the United States and the European Union as a terrorist organisation.

Earlier, Palestinian medical workers in Gaza said five people were killed and at least one is missing when a smuggling tunnel under the border with Egypt collapsed.

Reports said the cave-in was likely caused by heavy rainfall.

Gazans use tunnels to smuggle in goods that are not available in the territory because of Israel and Egypt's blockade of its borders.

Militants also use the tunnels to bring in weapons.

The ground around Rafah in southern Gaza, where the tunnels are concentrated, is sandy and notoriously unstable.

Israel: Netanyahu fails to strike deal with Kadima

JERUSALEM (CNN) -- Israel's next government is shaping up to be a narrow conservative coalition after designated Prime Minister Benjamin Netanyahu failed to strike a deal on Friday with the moderate Kadima Party.

"Unfortunately, I encountered a complete refusal for unity, a complete refusal to create joint teams to reach arrangements in order to find a common ground," Netanyahu told reporters after meeting with Kadima leader, Foreign Minister Tzipi Livni.

"I found no willingness for unity by Livni."

Israel's other major moderate party, Labor, has already stated its unwillingness to join a government led by Netanyahu's Likud Party.

Livni said the main sticking point was Netanyahu's refusal to adequately commit to negotiations with the Palestinians that would lead to a Palestinian state.

"A two-state solution is not an empty slogan," Livni said. "It is the only way in which Israel can maintain its existence as a Jewish and democratic state."

She said the meeting ended "without agreements on issues which I find essential in any entrance to the government."

But she left the door open just slightly, by saying that "a true unity is possible."

"There can be a government that will promote these issues," Livni said. "At the moment based on the conversation I just had in the next room, it is not going to be Netanyahu's government."

She did not say whether or not she would meet with Netanyahu in the future.

Kadima -- the party of outgoing Prime Minister Ehud Olmert -- won the most seats in the Knesset, Israel's parliament, in this month's elections. But Kadima received only one more seat than Likud. With the surge of other right-wing parties, Netanyahu already has enough seats to form a government. But he needed the cooperation of Labor or Kadima to fulfill his promise "to form a broad national unity government."

Netanyahu told reporters on Friday that he offered Livni several deals to get her to join the government, including complete partnership in writing the fundamentals of the government, equality in the number of positions in the government, and two of the three main positions in the government. He also said he offered a willingness to change the Israeli election system and find a solution to the issue of civil partnership.

Israeli President Shimon Peres tasked Netanyahu with forming a government last Friday. He has six weeks to do that or the process will start all over.

Palestinian groups vow to release prisoners, unify

(CNN) -- Palestinian rivals agreed Thursday to work toward ending their bitter fighting in an effort to form a unity government in Gaza and the West Bank.

Among the measures reportedly reached in an Egyptian-brokered meeting in Cairo was an agreement between the two largest rival factions, Hamas and Fatah.

Hamas, which controls Gaza, said it would release Fatah prisoners it holds in Gaza. Fatah agreed to do the same with Hamas captives held in Fatah's West Bank base.

The participants also agreed to stop smear campaigns in the media, according to a statement released after the meeting.

Representatives from other groups in the region also attended the meeting. Although the statement referred only to "all the Palestinian forces and factions," without naming them, Gaza's Ramattan news agency reported Fatah and Hamas were

The group agreed to form five committees to address the issue of prisoners, security and the formation of an election commission.

The statement said the committees would begin work March 10 and complete their work at the end of the month, by which time they hope a national unity government will be formed.

Several Western nations have expressed a reluctance to work with any government that includes Hamas, which the United States and Israel consider a terrorist outfit.

Tensions between Fatah and Hamas reached a climax in June 2007 when Hamas took control of Gaza in a bloody siege.

Palestinian security forces controlled by President Mahmoud Abbas' Fatah Party were expelled from Gaza, and Fatah has since held sway only in the West Bank.

Israel

Following World War II, the British withdrew from their mandate of Palestine, and the UN partitioned the area into Arab and Jewish states, an arrangement rejected by the Arabs. Subsequently, the Israelis defeated the Arabs in a series of wars without ending the deep tensions between the two sides. The territories Israel occupied since the 1967 war are not included in the Israel country profile, unless otherwise noted. On 25 April 1982, Israel withdrew from the Sinai pursuant to the 1979 Israel-Egypt Peace Treaty. In keeping with the framework established at the Madrid Conference in October 1991, bilateral negotiations were conducted between Israel and Palestinian representatives and Syria to achieve a permanent settlement. Israel and Palestinian officials signed on 13 September 1993 a Declaration of Principles (also known as the "Oslo Accords") guiding an interim period of Palestinian self-rule. Outstanding territorial and other disputes with Jordan were resolved in the 26 October 1994 Israel-Jordan Treaty of Peace. In addition, on 25 May 2000, Israel withdrew unilaterally from southern Lebanon, which it had occupied since 1982. In April 2003, US President BUSH, working in conjunction with the EU, UN, and Russia - the "Quartet" - took the lead in laying out a roadmap to a final settlement of the conflict by 2005, based on reciprocal steps by the two parties leading to two states, Israel and a democratic Palestine. However, progress toward a permanent status agreement was undermined by Israeli-Palestinian violence between September 2003 and February 2005. An Israeli-Palestinian agreement reached at Sharm al-Sheikh in February 2005, along with an internally-brokered Palestinian ceasefire, significantly reduced the violence. In the summer of 2005, Israel unilaterally disengaged from the Gaza Strip, evacuating settlers and its military while retaining control over most points of entry into the Gaza Strip. The election of HAMAS in January 2006 to head the Palestinian Legislative Council froze relations between Israel and the Palestinian Authority (PA). Ehud OLMERT became prime minister in March 2006; he shelved plans to unilaterally evacuate from most of the West Bank following an Israeli military operation in Gaza in June-July 2006 and a 34-day conflict with Hizballah in Lebanon in June-August 2006. OLMERT in June 2007 resumed talks with the PA after HAMAS seized control of the Gaza Strip and PA President Mahmoud ABBAS formed a new government without HAMAS. OLMERT in September 2008 resigned in the wake of several corruption allegations, but remains prime minister until a new government is formed after the general election in February 2009.

Militants launch rockets into Israel from Gaza

JERUSALEM (AP) — The Israeli military says Gaza militants have launched two rockets into southern Israel.

Wednesday's rockets caused no injuries. Sporadic violence along the Gaza-Israel border has persisted as Israel and Hamas try to hammer out a long-term truce through Egyptian mediation.

The truce talks began after the end of Israel's three-week Gaza offensive on Jan. 18.

Hamas wants Israel to open Gaza's border crossings, but Israel says it won't until Hamas frees an Israeli soldier held since June 2006.

Hamas says that will only happen if Israel releases hundreds of Palestinian prisoners, including high-ranking militants and the masterminds of deadly suicide bombings.