Madeleine Albright: "I am more than satisfied"

Mrs Albright was speaking after meeting the Israeli and Palestinian leaders on the border between Israel and the Palestinian-controlled Gaza Strip.

She said there was a new spirit of co-operation and a sense of urgency, but there were still a lot of problems to be resolved.

Mrs Albright spoke of a new spirit of cooperation

Next week's summit will involve President Clinton, the Israeli Prime Minister, Binyamin Netanyahu, and the Palestinian leader, Yasser Arafat.

The three extended their talks over lunch on the Palestinian side of the frontier. It was the first time Mr Netanyahu had crossed into a Palestinian-administered area.

Settlement ceremony

Mr Netanyahu is also attending a ceremony to confer city status on the West Bank settlement of Ariel.

Ariel, with 15,000 residents, is the second biggest settlement on the West Bank.

A spokesman for the prime minister dismissed suggestions that the ceremony would be provocative at this particular moment, adding that the date was set a long time ago.

Time running out

On Tuesday Ms Albright warned that time was running out for the peace process.

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"It is clear that as the Washington summit approaches, there is much work to do and hard decisions are required by both sides," she said.

"Time is not on our side, and if we don't move quickly we will find ourselves without an agreement and without the hope of achieving an Israeli-Palestinian peace."

Mr Netanyahu said: "If the Palestinians do their part, we shall do our part and we shall have an agreement. The most important thing is the operative war on terrorism."

But Israel's decision to strengthen the presence of Jewish settlers in the West Bank town of Hebron has already cast a cloud over reports of progress.

The Palestinians have described the move as "very, very dangerous", and our correspondent says it is a reminder that Mr Netanyahu and Mr Arafat must take on their domestic opponents if and when they decide to make the compromises necessary to make peace.

Hitches delay progress

The US has proposed that Israel should hand over a further 13% of the West Bank to Palestinian control.

Recent meetings between the two sides were reported to have achieved some progress.

However, several technical issues still remain unresolved including the opening of an airport and a seaport in the Gaza Strip, safe passage between the Gaza Strip and the West Bank, and the creation of an industrial zone at one of the crossing points between the Gaza Strip and Israel.

Israel has demanded that the Palestinians should make greater efforts to meet its security concerns before it can hand back more territory.

The interim phase of the peace process - under which Israel undertook to carry out a series of redeployments in the West Bank and Gaza - has been badly delayed by disagreements between the two sides.