Round 2 of Israeli-Palestinian talks begins in Egypt

US Secretary of State Hillary Clinton faces an urgent test of mediation savvy in Israeli-Palestinian talks, which could break down over the settlement freeze set to expire Sept. 26.

US Secretary of State Hillary Clinton is meeting Israeli and Palestinian leaders today in Sharm el-Sheikh, Egypt, in an attempt to avoid a breakdown of peace talks over Israeli settlements in the West Bank.

With Palestinians vowing to quit the talks if Israel does not agree to extend the settlement freeze due to expire Sept. 26, the summit is shaping up to be a cliffhanger test of American mediation savvy.

"The Americans are going to have to do the finessing," says Gershon Baskin, codirector of the Israel Palestinian Center for Research and Information. "Each side has climbed up a ladder. Can the Americans convince each side that they can get enough out of [the talks] so they continue the negotiations?''

President Obama has appealed to Israeli Prime Minister Benjamin Netanyahu to extend the freeze. The prime minister, however, has said building will resume, though he has hinted at a possible compromise.

Will Netanyahu and Abbas bend?

Both Mr. Netanyahu and Palestinian Authority President Mahmoud Abbas, who will meet again tomorrow in Jerusalem, are under heavy political pressure at home not to bend.

Israeli settlers have threatened to bring down Netanyahu's government if he continues the freeze, suggesting real concerns that the prime minister's stance on settlements has evolved since the hard-line approach he took during his first term, in the 1990s.

"The clearest sign [of Netanyahu's evolution] is the almost hysterical response of the leaders of the settlement movement," says Shmuel Rosner, a columnist for the Jerusalem Post. "They have realized sooner than most Israelis that the prime minister is willing to compromise on settlements more than in the past."

To make it easier on them, the US needs to reward the sides – assurances for the Palestinians on the territorial dimensions of a future state and for the Israelis on security, Mr. Baskin says.

The Israelis have said that they want to discuss first security arrangements and their demand for Palestinian recognition of Israel as a Jewish state. The Palestinians want to discuss an agreement on borders.

Top 5 issues on the table for Israeli-Palestinian talks

Only 1 in 5 Israelis think Abbas sincerely wants peace

At the inaugural round in Washington earlier this month, the sides agreed to a one-year target for an agreement. But that hasn't gone far toward spurring optimism about the prospects for a deal.

A poll published Tuesday in the Israeli daily newspaper Yediot Ahronot found that 71 percent of respondents don't believe that the talks will lead to a peace agreement. Only one-fifth of the Israelis polled believe that Mr. Abbas is sincere about reaching an agreement. And only 1 in 3 believe their own leader, Netanyahu, is sincere about reaching an agreement.

The Palestinians have also grown weary of peace summits, and have low expectations that a deal can be reached after 17 years since the first Israeli Palestinian accord.

But not everyone in the region is blasé about the talks. Hamas, in an attempt to undermine the Western-sponsored Palestinian Authority in the negotiations, has pledged a campaign of attacks against Israelis.