The leadership of Israel's left-wing Meretz party refused late Thursday to back the candidacy of Shimon Peres for prime minister, reported AFP.
"This decision was taken with a slight majority of the members of the Meretz leadership, and I am happy that the left will present a united front in the election of prime minister," Meretz deputy Haim Oron told Israeli public radio.
"Our aim is to achieve the victory of (Israeli Prime Minister) Ehud Barak over Ariel Sharon," the leader of Israel's main right-wing opposition party, Likud, he added.
"We will therefore also be able to push peace efforts," with the Palestinians, he added.
After his failure, Peres told the country's second private television channel: "I continue to support the peace process."
Al Jazira satellite channel said that Barak reiterated his offer for Peres to play a key role in the peace process.
The leader of Meretz party, Yossi Sarid, had said earlier that he failed in his attempt to mediate between Peres and Barak over the upcoming elections, Israel's second private channel reported.
Sarid was to host a meeting in Tel Aviv late Thursday with the two men to try to convince them to cooperate on upcoming elections.
"Sarid is going to attempt mediation in Tel Aviv between Peres and Barak for them to cooperate in the run-up to the election for the post of prime minister," Oron told Israel's second private television channel.
Oron, who was against his party's support for the candidacy of Peres in this election added: "if there is a two-headed candidacy from the left, that will mean that one will fall, and that Sharon is assured of victory."
Another Meretz deputy, Mossi Raz, however, said that "the desire of the peace camp is to block the road to Sharon, and it is Peres who has the best chance of doing just that.”
Latif Duri, an Arab member of Meretz told Al Jazira that the party decided a third candidate would split up the peace camp.
Peres had earlier in the day rejected Sarid's recommendation that the minister join forces to lead the peace camp with Prime Minister Barak, reported The Jerusalem Post newspaper, quoting the army radio.
Peres said the idea would dash any hopes of winning the upcoming prime ministerial election.
Sarid recommended earlier in the day that Barak and Peres join forces to lead the "peace cam." Peres should take a position of leadership alongside Barak. A formula to this effect should be worked out and accepted by both sides," he said.
"The side which does not accept this will not receive Meretz's support," he said.
Barak said he was prepared to have Peres participate in the peace process - starting immediately. Peres would have a senior role in keeping with his experience and status, Barak said.
Peres, the 77-year-old former Labor leader, officially announced late Wednesday that he intends to run for the nation's top job, setting the stage for a three-way clash with Barak and Likud Leader Ariel Sharon.
Peres needed to win the support of at least 10 MPs to be eligible. Meretz has the required number that may enable Peres to run for the premiership.
Meanwhile, Israel's National Religious Party leader Yitzhak Levy and Shas leader Eli Yishai announced Thursday that they would not run in the upcoming prime ministerial elections scheduled for February 6, reported Haaretz newspaper, quoting the Israeli Radio.
Levy, whose party strongly supports Jewish settlement in the West Bank and Gaza Strip, said he had decided not to run after receiving adequate answers from Likud's candidate for prime minister, Ariel Sharon, regarding his views on future diplomatic efforts with the Palestinians, according to the report.
Levy's decision came after a meeting with the party members to decide on the matter, said The Jerusalem Post newspaper - (Several Sources)
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