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Mideast Peace Talks Face New Obstacles

Another round of peace talks takes place in the Middle East this week amid new obstacles.

Israeli Prime Minister Benjamin Netanyahu convened his Cabinet two days after U.S. President Barack Obama urged him to extend a freeze on settlement construction that is due to expire in two weeks.

"What I have said to Prime Minister Netanyahu is that it makes sense to extend that moratorium so long as the talks are moving in a constructive way," he said.

The issue will be high on the agenda when Mr. Netanyahu and Palestinian President Mahmoud Abbas meet for a new round of peace talks Tuesday in Egypt, hosted by U.S. Secretary of State Hillary Clinton.

Mr. Netanyahu did not comment on the settlement freeze but added a demand of his own.

He said there cannot be peace unless the Palestinians recognize Israel as a Jewish state.

The Palestinians reject that because it would harm the rights of Israeli Arabs and Palestinian refugees. Palestinian officials accused Mr. Netanyahu of trying to divert attention from the settlement freeze.

But Israeli Cabinet Minister Yuval Steinitz of the ruling Likud Party said Israel's position is clear.

He said the 10-month construction freeze will end on schedule on September 26th, according to a previous decision of the Israeli Cabinet.

If that happens, the Palestinians say they will pull out of the peace talks.