Aqaba, JIB. King Abdullah held talks in Aqaba with German Chancellor Angela Merkel amid new momentum to resolve the Palestinian-Israeli conflict.

"During our meeting, the chancellor and I spoke first and foremost about the need to build on the momentum of the Arab summit to move the Arab Peace Initiative forward and bring peace, stability and security to the people of the region," King Abdullah told reporters at a joint press conference with Merkel.

"Jordan looks forward to working closely with you and our European partners, to advance the initiative as an ideal framework for political negotiations between Arabs and Israelis."

European Union foreign ministers on Saturday hailed the Arab Peace Initiative and agreed to engage with non-Hamas members of the new Palestinian national unity government.

The EU voiced full support for the plan revived at the Arab summit in Riyadh last week, offering Israel peace and relations in exchange for complete withdrawal from Arab land occupied in 1967 and a solution to the Palestinian refugee problem.

"The Arab Peace Initiative reaffirms the Arab people's desire and will to live in a peaceful Middle East with Israel. The initiative is also able to achieve a comprehensive settlement to the Arab-Israeli conflict, beginning with the creation of a sovereign, viable and independent Palestine living side-by-side with a secure Israel," the King said.

Merkel, whose country holds the EU's rotating presidency, was in Aqaba at the start of a Middle East tour aimed at adding a European dimension to the Arab initiative. She was to travel on to Israel, Lebanon and the Palestinian territories.

Yesterday, the German chancellor urged the new Palestinian unity government to embrace Western demands that it recognise Israel and renounce violence to revive Middle East peace talks.

"We call on the members of the unity government to adhere to the Quartet principles... to bring forward the peace process," she was quoted as saying at the press conference.

The Quartet of Middle East peace negotiators - Russia, the United Nations, the European Union and the United States - called for those two conditions and the acceptance of existing peace accords.

"We want to support those forces that abide by the Quartet principles," she said.

The EU ministers yesterday said they would seek ways of redirecting aid to the Palestinian Authority towards institution-building and economic development in talks with Palestinian Finance Minister Salam Fayyad

But they warned against expecting an overnight resumption of direct assistance to the Palestinian Authority.