The PLO's Central Council began its second and final day of deliberations on Sunday amid expectations it will delay a planned declaration of statehood.
More than 100 members of the 129-seat council went into closed-door deliberations at the Gaza City office of Palestinian leader Yasser Arafat at around 10:45 a.m. (0745 GMT).
Council members expect Arafat will ask them to push the statehood proclamation back from the much-heralded date of September 13th to help him in a last ditch round of peace negotiations with Israel due to kick off soon in the region.
"The general mood in the council is that they want the declaration of the state by year's end," said council chairman Salim al-Za'noun.
Arafat was due to have announced the creation of an independent Palestinian state in May 1999, but held off under international pressure.
Meanwhile, Israel's acting Foreign Minister Shlomo Ben Ami welcomed Sunday a likely delay in a Palestinian declaration of statehood as a positive sign that would help advance peacemaking.
"If the Palestinians decide to delay the proclamation of a state we can only applaud it because it shows their desire to continue the peace process in a positive way, even if I consider that the chances of an accord are slim," he said.
Ben Ami told army radio that he did not expect the council, the second most important PLO decision-making body, to set a new date.
Transport and Tourism Minister Amnon Lipkin-Shahak warned that a unilateral declaration would set off a crisis in the peace process.
"All contacts would be broken off and the Israeli government would be forced to take unilateral measures," said Lipkin-Shahak, a former army chief who has taking part in negotiations with the Palestinians.
"The Palestinians don't want that, which is why they are expected to announce a delay," he told public radio.
Israel has in the past warned it could annex parts of the West Bank where Jewish settlers live if the Palestinians declare a state without a peace deal.
Negotiations are expected to resume in the region in a matter of days, following the breakdown of the Camp David summit in July over the key issue of Jerusalem.
In New York, US President Bill Clinton and Israeli Prime Minister Ehud Barak agreed in a meeting Saturday to try to push the Israeli-Palestinian peace process forward in the coming days and weeks, as time for an agreement is running out.
"(They) agreed to continue to be in touch in the coming days and weeks and to follow the efforts made to find the necessary basis to advance the Israeli-Palestinian negotiations," an official Israeli statement issued shortly after the meeting said.
Earlier, an Israeli official, speaking to AFP on condition of anonymity, said Barak and Clinton were to outline a plan of intensive talks for the coming three critical weeks - (AFP)
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