Jerusalem is not recognised internationally as Israel's capital

However, President Clinton said two months ago that he was considering moving the United States embassy to Jerusalem and would review the matter at the end of the year.

The statement, made at the Arab League meeting in Cairo, coincides with reports of new efforts to revive the peace process.

Stumbling block

In Cairo, the Arab foreign ministers reaffirmed that they were committed to peace but were supporting Yasser Arafat's position that peace could only be sealed when Israel agreed to Palestinian sovereignty over East Jerusalem.

The status of the city was the main stumbling block in the latest round of Palestinian-Israeli peace talks held under US mediation at Camp David in July.

There has been a flurry of diplomatic activity aimed at reviving the talks ahead of 13 September, the deadline set by the Palestinians and Israel to solve all outstanding disputes

Morocco meeting

The acting Israeli Foreign Minister, Shlomo Ben Ami, is reported to have had talks on the peace process in Morocco on Monday.

Israel radio said that Mr Ben Ami paid a secret visit during which he met King Mohamed and the Foreign Minister, Mohamed Benaissa, in the southern city of Agadir.

The talks come days before the Israeli and Palestinian leaders are due to have separate meetings with President Clinton in New York.

Meanwhile, a senior Palestinian official has indicated that it is unlikely that statehood will be declared, as planned, next week.

The head of the PLO's political department, Faruq Qaddumi, said 13 September was not a sacred date, and that as long as peace negotiations were continuing he did not think there would be a declaration then.