JERUSALEM - Incoming Israeli prime minister Benjamin Netanyahu said Wednesday his government would be a "partner for peace with the Palestinians," softening his rhetoric a day after the centrist Labour arty joined his coalition in exchange for vaguely worded promises to pursue negotiations.
During his election campaign, the hardline Likud party leader had painted himself as an opponent of peacemaking. But facing the prospect of a clash with the new U.S. administration, Netanyahu has been courting moderate coalition partners and tempering his line.
Peace is a "common and enduring goal for all Israelis and Israeli governments, mine included," Netanyahu told an economic conference in Jerusalem. "This means I will negotiate with the Palestinian Authority for peace," he added.
"The Palestinians should understand that they have in our government a partner for peace, for security, for the rapid development of the Palestinian economy," Netanyahu said.
Palestinians welcomed Netanyahu's words, but said they must be matched by deeds.
On Tuesday, U.S. President Barack Obama said it was "critical" to advance Palestinian statehood, while acknowledging that "it's not easier than it was," given the rightward political shift in Israel.
Netanyahu led Likud to a strong showing in last month's parliamentary election by harshly criticizing the outgoing government's peace efforts. He said the Palestinians were not ready for independence and promised to limit his efforts to developing their economy while continuing Israel's occupation of the West Bank.
Netanyahu has tried unsuccessfully to also draw the centrist Kadima party of outgoing Prime Minister Ehud Olmert into his government. But Kadima leader Tzipi Livni appeared cool to the idea even after the pact with Labour and Netanyahu's pledge to pursue Palestinian peace talks.
Livni on Wednesday called Netanyahu's prospective coalition a government "conceived in sin."
Netanyahu said his plan to develop the Palestinian economy was not a substitute for political negotiations but "a complement to them." A strong Palestinian economy is a "strong foundation for peace," he said.
Netanyahu spoke hours after Labour voted to join his coalition, adding a moderate element to what had been shaping up to be a narrow, hawkish government. Labour led the country for decades and signed previous peace agreements with the Palestinians and Jordan in the 1990s.
To woo Labour, Netanyahu promised to maintain peace negotiations. However, their deal offered no details about what they hope to achieve at the end of the process.
Netanyahu has refused to embrace the notion of establishing an independent Palestinian state on captured lands now occupied by Israel. And he has said he would allow existing Jewish settlements in the West Bank to expand -- a red flag for the Palestinians.
Palestinian negotiator Saeb Erekat cautiously welcomed Netanyahu's comments, but said the new government must commit to establishing a Palestinian state.
"Any Israeli government that accepts the two-state solution, negotiates with us on all core issues without exception, and agrees to stop settlement activity ... will be a partner," he said. "It's time for deeds from both sides as far as their commitments are concerned, not words."
The core issues are the final borders of the Jewish and Palestinian states; the status of disputed Jerusalem, whose traditionally Arab eastern sector the Palestinians seek as a future capital; and a solution for Palestinian refugees who fled or were driven from Israel during the 1948 Middle East war.
The coalition partners Netanyahu has brought on so far could make it difficult to advance these issues. His designated foreign minister, Avigdor Lieberman of the ultranationalist Yisrael Beiteinu party, has drawn allegations of racism by proposing that citizens declare their loyalty to the Jewish state or lose their citizenship. The proposal is widely seen as a not-so-veiled attack on Israel's Arab minority.
Another coalition partner, the ultra-Orthodox Shas party, objects to even discussing sharing Jerusalem with the Palestinians.
And although Labour has a moderate image, it's not clear the party will actually press hard on peacemaking.
Labour's chairman, Defence Minister Ehud Barak, offered large-scale territorial concessions to the Palestinians when he was prime minister a decade ago.
But in the two years since he's become defence minister, he has disregarded U.S. demands that Israel take down unauthorized settlement enclaves and done little to ease onerous restrictions on Palestinian movement in the West Bank.
He also was the chief strategist for Israel's blistering war on Gaza earlier this year and its crippling blockade of the tiny territory.
With Labour's support, Netanyahu now has a parliamentary majority. He hopes to swear in his new government next week.
