Israeli Prime Minister Ariel Sharon suffered a major political setback, after his Likud Party adopted a resolution completely rejecting the establishment of a Palestinian state. The decision is victory for his main rival, the former Prime Minister, Benjamin Netanyahu. At a raucous meeting in Tel Aviv, Mr. Sharon and Mr. Netanyahu went head-to-head over whether the party should vote on a resolution calling for a complete rejection of a Palestinian state.
A proposal by Mr. Sharon to postpone the vote was defeated in a secret ballot by a margin of 18 percent.
Mr. Sharon had tried desperately to prevent the ballot, arguing that it would precipitate pressure on Israel internationally and tie his hands in diplomatic negotiations.
His speech was met with a chorus of boos from many of those present at the meeting of Likud Central Committee.
On two separate occasions last year, Mr. Sharon publicly expressed his support for the establishment of a Palestinian state, once hostilities had ended.
Mr. Netanyahu opened his remarks with a call for Palestinian leader Yasser Arafat to be sent into exile.
He says he supports an entity that allows Palestinians to govern themselves but opposed granting them all of the rights that come with statehood, such as maintaining an army and acquiring weapons, because such a state would threaten Israel's existence.
An angry Mr. Sharon who stormed out of the meeting, issued a brief statement afterwards saying he would honor the party's decisions.
Palestinian chief negotiator, Saeb Erekat, says the vote is a major blow to efforts to revive the Middle East peace process.
He says that the decision shows that Israel intends to continue ruling over Palestinians and has no desire to grant them independence.