Israel has proposed a gradual withdrawal from occupied West Bank cities where it sees Palestinian security forces making serious attempts to prevent resistance attacks, a high-ranking Israeli official said Saturday. The proposal was raised last week in the first direct meeting Israeli Prime Minister Ariel Sharon held with Palestinians in nearly a year and came as the United States steps up preparations for a possible strike on Iraq.

Washington has repeatedly appealed to Israel and the Palestinians to rein in violence ahead of any military action it may take in the Gulf.

Sharon's Wednesday meeting with Palestinian Legislative Council speaker Ahmed Korei was confirmed by a political source on Friday and coincided with his attempts to bring the center-left Labour Party into a unity government.

Labour Would Join Likud Coalition Government it Sharon Resumes Talks with The Palestinians

Labour has said Sharon must resume talks with the Palestinians before it would consider entering his government.

Dov Weisglass, head of Sharon's office, outlined on Israel Radio the proposal made to the Palestinians and acknowledged that positive moves could boost coalition negotiations.

"The plan has been to encourage the Palestinians to act energetically and with determination to stop 'terror'," he said.

"It proposes that everywhere they succeed in preventing attacks or showing that they are making serious efforts to do so, Israel will react accordingly by changing its military deployment in the area and easing restrictions on trade and movement," he added.

Weisglass, who met Palestinian Interior Minister Hani al-Hassan last week, pointed to recent Palestinian security patrols in Gaza to stop rocket attacks on Israeli towns.

Weisglass said Israel was also considering allowing Palestinian debilitated security forces to rebuild.

There was no immediate Palestinian comment to the proposal, which was similar to those made in the past, but a Palestinian official confirmed the talks took place.

"We will deal with all parties for the sake of peace," Palestinian President Yasser Arafat said on Saturday, declining to confirm Korei's meeting with Sharon.

Sharon has refused to meet Arafat, saying he is irrelevant and foments violence, accusations Arafat strongly rejects.

Homes Demolished in Gaza & West Bank

On Saturday, Israel continued operations against Palestinian resistance activists spearheading the 28-month uprising for independence and demolished 13 homes in the West Bank and Gaza Strip.

Two of the homes belonged to families of activists who were killed as they attacked an Israeli outpost overlooking the center of the West Bank city of Nablus early Thursday, leaving two Israeli occupation soldiers dead, the occupation army and Palestinians said.

Another 11 homes were razed in the Gaza Strip refugee camps of Khan Younis and Rafah, Palestinian sources said.

Also on Saturday, a 35-year-old Palestinian teacher died a month after being shot by Israeli occupation soldiers in Gaza.

PHOTO CAPTION

An Israeli occupation soldier turns back Palestinians trying to reach the Carantina medical clinic during a partial lift of curfew in the West Bank city of Hebron, February 8, 2003. (Nayef Hashlamoun/Re