Mr Rice spent two hours locked in talks with Palestinian president Mahmoud Abbas and his prime minister Salam Fayyad in Ramallah.

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It was immediately followed by a second meeting with Israeli Prime Minister Ehud Olmert to prepare for the US-sponsored conference expected in November.

“The international meeting has to be serious. It has to be substantive,” Ms Rice told a news conference with Mr Abbas on a visit overshadowed by Israel declaring that the Gaza Strip was a “hostile entity”.

“The issue here is to move the process forward, to a document that will help lay a foundation so there can be serious negotiations on the establishment of a Palestinian state as soon as possible,” she added.

Ms Rice pledged that she, US President George W Bush, Mr Olmert and Mr Abbas would work “very aggressively, very urgently to lay the groundwork for a successful meeting … that advances the cause of the Palestinian state.”

Talks ‘serious’

Mr Abbas said that in meetings with Olmert the two leaders “were serious in our quest to reach a framework agreement on final status questions, in other words borders, Jerusalem, refugees, settlements and water.”

The Palestinian leader said that he and Rice discussed “the good preparation that is needed to assure the success” of the summit which he said should take place in mid-November.

Upbeat assessment

The top US diplomat later met Mr Olmert before boarding a flight back to the United States for the UN General Assembly and talks with the other main sponsors of the stalled Middle East peace process.

On the airplane, Rice was upbeat about the summit.

“I think the announcement of an international gathering some time in the fall (autumn) has helped to galvanise people to try to move forward,” she said.

Differing expectations

Abbas and Olmert have been at odds over what exactly they want to achieve before the conference.

Olmert lowered expectations on Sunday, saying both sides will issue a joint declaration during the meeting instead of an agreement of principles. In response, the Palestinian Authority said substance is what mattered.

The Palestinians have long wanted a detailed framework agreement on core issues while Israel has talked about a more vague declaration of principles.

However, on the plane, Ms Rice lauded both leaders for their efforts.

“I think they are building some trust. Everybody now talks about the excellent atmosphere between them,” she said.

Ms Rice’s sixth visit to the region this year was overshadowed when Israel yesterday branded Gaza a “hostile entity” and warned it could cut basic supplies to the impoverished Hamas-run territory in response to rocket attacks.

Mr Abbas said the declaration carried “grave political significance”.

“All these measures undermine the efforts exerted by our government to establish security and the rule of law in all Palestinian territories. We will continue to supply our people in

Gaza with all basic supplies,” he said.

Mr Rice yesterday said she made a distinction between Hamas and the civilian population, vowing not to “abandon innocent Palestinians” but calling Hamas a hostile entity. “It is a hostile entity to the United States as well.”

Israel said its decision paved the way for cutting electricity and fuel to the territory that Hamas – branded a terror group by the West – has ruled for three months, and further restricting the movement of goods and people.

The move faced an international chorus of protest, with aid groups slamming it as illegal collective punishment.

Rice urges Mideast talks