The Palestinian president says he wants a firm position from America on Israeli settlement plans in the West Bank, by the time George Bush visits next week. Mahmoud Abbas raised the subject in talks with Egyptian President Hosni Mubarak.

The provision in Israel’s budget for hundreds of new Jewish homes outside Jerusalem is blocking the peace talks.

Abbas made it clear that the settlement issue was the main obstacle to peace at the moment and it was likely to dominate President Bush’s first visit to the Mid-East next week.

Bush, Abbas and Israeli Prime Minister Ehud Olmert will sit down together in Jerusalem on January 10.

Olmert has said any further settlements would have to be personally approved by him or the defence minister. But he also said the edict did not apply to east Jerusalem or West Bank projects already approved.

Another problem which has been simmering on the Egyptian border was resolved today. Hundreds of Palestinians returning from Mecca were stuck there for more than a week after Israel insisted they pass through an Israeli checkpoint.

Israel said it was to make sure they were not Hamas fighters, or taking money or weapons into Gaza. But the Egyptians opened the border today and let the Palestinians through after hundreds more arrived.

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