The ministers, meeting in Sirte, Libya, made it clear that the direct talks with the Palestinians relaunched just last month would collapse if Israel did not halt settlement expansion in the occupied West Bank.

The Arab League Follow-up Committee said it would meet "in a month to review the alternatives proposed by (Palestinian president Mahmud) Abbas to determine the necessary steps to be taken on this."

The committee of 13 foreign ministers urged Washington to pursue efforts in the meantime to stop Israeli settlement activity.

It added that it "supports the position of the Palestinian president calling for a total cessation of settlement to allow the resumption of direct negotiations."

Abbas spokesman Nabil Abu Rudeina said the statement "offers huge support for the position of president Abbas.

"The committee will convene again in a month to study the alternatives, which gives the US administration a chance between now and then to try to find a solution to the settlements issue," he said.

Washington expressed appreciation for the ministers' statement of support for its efforts.

"We will continue to work with the parties, and all our international partners, to advance negotiations toward a two-state solution and encourage the parties to take constructive actions toward that end," State Department spokesman Philip J. Crowley said.

Israeli Prime Minister Benjamin Netanyahu's office declined comment on Saturday.

However, public radio quoted an unnamed official close to Netanyahu as saying Israel was satisfied with the decision not to immediately pull the plug on talks, welcoming the move as a "victory for pragmatism."

Netanyahu has made no move to renew the freeze, partly because he does not have the support for it in his mostly right-wing coalition.

For the Palestinians, Jewish settlements are a major threat to the establishment of a viable future state in the West Bank, and they see the freezing of settlements as a crucial test of Israel's intentions.

The Islamist Hamas movement, which has controlled the Gaza Strip since ousting forces loyal to Abbas in 2007, expressed frustration that Arab ministers had not gone further in supporting the abandonment of talks.

"Giving more time to the Americans will just bring more pressure on Arab governments and the Palestinian side and lead to the actions of the Israelis being ignored," spokesman Fawzi Barhum told AFP.

Abbas came to Sirte to seek backing to withdraw from the peace negotiations after Israel adamantly refused to extend a freeze on settlement building that expired on September 26.

Last-ditch efforts to reach a compromise appeared to have failed, with Israel silent on the moratorium and the Palestinians insisting they would not talk while settlement activity continued on land they want as a future state.

The ministers' statement came after Arab League chief Amr Mussa gave a dire assessment of the outlook for the peace talks, which resumed on September 2 after a 20-month hiatus.

"The situation is negative and is not favourable to direct negotiations," Mussa said, adding there were many alternative measures the Arabs could take including "going to the (UN) Security Council."

On Saturday, however, Egyptian Foreign Minister Ahmed Abul Gheit said "recourse to the Security Council to declare an independent Palestinian state is not currently on the agenda."

In London, British Foreign Secretary William Hague said a settlements freeze was "urgently important" to enable talks to continue.

"We must make progress before the window closes on a two-state solution," he said in a statement.

France, "while noting the current impasse," welcomed the Arab decision to "leave the door open" to a resumption of the talks, foreign ministry spokesman Bernard Valero said in a statement.

"Every effort must be made now to find a way to ensure the continuation of the process started on September 2 in Washington by the Americans, which we fully support," he said.

French Foreign Minister Bernard Kouchner and Spanish counterpart Miguel Angel Moratinos will visit Israel, the Palestinian territories and Jordan on Sunday and Monday to discuss European involvement in the peace process.

burs/srm

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