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Israel Heads for Early Elections After Livni Fails to Form Coalition

Israel is headed for early elections, after Prime Minister-designate Tzipi Livni on Sunday announced she has given up efforts to form a coalition government. Livni's failure to form a government is a setback for efforts to reach a peace deal with the Palestinians by year's end. VOA Jerusalem correspondent Luis Ramirez reports.

For weeks, Tzipi Livni has been negotiating with Israel's ultra-Orthodox Shas party. Livni was elected head of the centrist Kadima party last month, and was due to replace Prime Minister Ehud Olmert, who resigned last month amid corruption allegations.

Livni was given several weeks to form a coalition government or face early elections.

On Sunday, Livni announced she was dropping efforts to form a government. She said she decided to stop the talks when it became clear that parties were taking advantage of the opportunity to pose what she said were illegitimate economic and political demands.

Livni told reporters on Sunday she had informed President Shimon Peres that, given the circumstances, there would have to be elections as soon as possible.

It is now up to President Peres to call for the poll, which could take place in February, more than a year ahead of schedule.

Parties in Israel are deeply divided over how to resolve the conflict with the Palestinians. The Shas party has opposed any Israeli concession on Jerusalem, the eastern part of which the Palestinians want as the capital of a future Palestinian state.

Livni was unwilling to promise Shas hundreds of millions of dollars it demanded for welfare and religious programs. The party's support base is largely among Israel's impoverished, ultra-conservative Jewish factions.

Speaking on Israeli radio, Shas leader Eli Yishai said his party cannot be bought and will not sell Jerusalem. He said that has been the party's message since the start of talks, and once its demands on Jerusalem and child allowances were not met, the party decided it could not join the government.

Livni has preferred to push for a negotiated settlement with the Palestinians. Her centrist position will be put to the test in new elections that analysts say will be tough for her party to win.

Support has been building in Israel for Benjamin Netanyahu and his right-wing Likud party, as many Israelis have expressed growing uneasiness over what they perceive as the growing threat of Iran and its nuclear ambitions. Concern is also mounting over instability in the Palestinian territories, which are divided between the moderate Fatah faction in the West Bank and the rival militant Hamas group in the Gaza Strip.

With Israel's internal politics in turmoil, prospects of negotiating a deal with the Palestinians soon appeared unlikely.

A Palestinian negotiator on Sunday said he hopes Israel will stay the course and continue with the peace process. Talks brokered by the United States since last November have made little visible progress, and both sides said it will be difficult for them to reach an agreement by year's end as Washington has urged them to do.