The Palestinian leadership are ready for full talks on resolving all issues with our neighbours, the Israelis

Yasser Arafat

The US is looking to convene an international peace conference after 19 months of violence in the region.

But despite the talk of peace, Israeli military operations in Palestinian-controlled areas of the West Bank have continued and at least three people have died.

A spokesman for Mr Sharon said the prime minister had long supported the idea of a conference at which the outline of a long-term political settlement could be drawn up.

Mr Sharon has summoned the party leaders in his coalition government to discuss strategy, and is reported to be outlining new proposals which he will discuss with US President George W Bush next week in Washington.

Israel launched a brief raid on the town of Nablus

Mr Arafat - freed on Thursday from his Ramallah headquarters following a siege by Israeli forces - welcomed the conference proposal.

"The Palestinian people and the Palestinian leadership are completely ready for full talks on resolving all issues with our neighbours, the Israelis, under the auspices of the Americans, Europeans, and Arabs," he said in a statement carried by the official Palestinian news agency, Wafa.

But he added later that he would consult Arab leaders before deciding whether to agree to the conference.

'Last chance'

US Secretary of State Colin Powell has said he regards the proposed conference as Mr Arafat's last chance to grasp peace with Israel.

Thursday's announcement of the planned conference came after Mr Powell hosted talks with United Nations Secretary General Kofi Annan, the Russian and Spanish foreign ministers and EU foreign policy chief Javier Solana.

There are calls for a full independent investigation into events at Jenin

Arab League foreign ministers are to meet in Cairo next Wednesday to discuss their response to the planned conference, which will be sponsored jointly by the US, the UN, the EU and Russia.

But the BBC's Paul Reynolds says it is difficult to see this conference as anything more than first aid.

The fundamentals of the problem, he says, remain the same - whatever might be on offer from the Israeli Government is not going to be enough to satisfy the aspirations of the Palestinians.

In the latest violence in the region, two Palestinians, one of them a policeman, and an Israeli army officer were killed during a Friday morning raid by the Israelis on the West Bank town of Nablus.

Seventeen Palestinians are reported to have been detained across the West Bank. The Israeli army said some of those held were preparing a suicide bombing attack.

And in Bethlehem, the Israeli siege of the Church of the Nativity - inside which Palestinian gunmen and civilians are trapped - is in its fifth week.

Four Palestinian policemen, who were said to be ill, were brought out of the church on Friday after consultations with the Israelis.

Massacre denied

Human Rights Watch (HRW) has issued a report accusing the Israeli army of war crimes during its assault on the Jenin refugee camp last month.

However, it denied Palestinian claims that Israeli troops carried out and covered up a massacre of civilians.

HRW has called for a full independent inquiry into the situation.

Despite this, the UN secretary general has announced that he is formally disbanding the mission to investigate events at the refugee camp, following Israeli objections.