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Merkel echoes Israel's fears on Egypt stability (2nd Roundup)

Jan 31, 2011, 19:01 GMT

Jerusalem - Visiting German Chancellor Angela Merkel echoed Israeli fears over the stability of the Middle East on Monday as unrest swept Egypt.

But she also urged Israeli Prime Minister Benjamin Netanyahu to halt construction of Jewish housing in Palestinian areas.

The German chancellor is in Israel for two days of meetings, along with much of her cabinet.

'We know of course that Egypt has played a very positive role for Israel in particular in the many efforts to establish peace, as well as a stabilizing role,' she said.

Merkel insisted that Germany supported democratic rights and implicitly criticized embattled Egyptian President Hosny Mubarak for not going far enough in his offer of dialogue. She said that it was crucial for him to act wisely in the coming days.

Netanyahu referred after his meeting with Merkel of the 'dramatic events' in neighbouring Egypt and said he was concerned Islamists would take over.

'In a situation where chaos rules, there could be an Islamist factor that seizes power,' he said.

'We don't want to revert to the bad old days,' he said in reference to the period before Egypt and Israel made peace in 1979.

Netanyahu appeared to imply that the current popular protests in Arab nations made it more difficult to achieve peace terms with the Palestinians.

'Peace has to be anchored in stability,' he said. 'A piece of paper does not guarantee peace.'

Merkel disagreed in the joint remarks to reporters, stressing the importance of driving forward the Middle East peace process, even in the current climate.

'Deadlock is no viable basis, and deadlock is unacceptable, in this situation more so than ever. For me, and I made this clear today, deadlock is also illusory,' the chancellor said.

Merkel rebuked Israel over housing construction in the West Bank and referred to the international community's 'roadmap' for the peace process.

'From our point of view, settlement building is not in conformity with the commitments made in the roadmap - and we spoke about that too.'

The chancellor had arrived earlier in the day with key ministers for a round of meetings with Israeli counterparts on cooperation in science and development aid and stepping up youth exchanges.

While the German ministers were set to head home afterwards, Merkel was to stay over for a second day of meetings with Israeli officials.

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