Israeli and Palestinian leaders met in a fresh effort to advance the peace process.  Robert Berger reports from the VOA bureau in Jerusalem.

Palestinian President Mahmoud Abbas, also known as Abu Mazen, left, and Israel's PM Ehud Olmert meet in Jerusalem, 31 Aug 2008

Israeli Prime Minister Ehud Olmert hosted Palestinian President Mahmoud Abbas at his official residence in Jerusalem.  The meeting took place several days after U.S. Secretary of State Condoleezza Rice visited here to push for a peace agreement by the end of the year.

Both sides say a full peace treaty is impossible now, so Mr. Olmert proposed formulating a memorandum of understanding to present to the United States. 

"And the idea of working on a framework, a framework of principles, that is good for us, that is good for the Palestinians, that is good for everyone," said his spokesman Mark Regev.

The Palestinians rejected the idea of a partial agreement, saying gaps remain wide on core issues such as the status of Jerusalem, Jewish settlements, and Palestinian refugees.  

"You need to decide on the parameters of how these issues are solved, how Jerusalem is solved, how refugees is solved, how water is solved, once and for all," said Palestinian negotiator Saeb Erekat.

Mr. Olmert wants to move quickly because he plans to resign in mid-September over a corruption scandal, though he could remain in office as caretaker prime minister for many months.

Israeli opposition leader and former Prime Minister Benjamin Netanyahu says that as a lame duck, Mr. Olmert has no mandate to make territorial concessions.

Mr. Netanyahu said the government is trying to redeem itself with dubious agreements with the Palestinians, but he said it has lost the confidence of the Israeli public.