Israeli Prime Minister-designate Benjamin Netanyahu enlisted Ehud Barak's Labour party yesterday into a political partnership that could help Israel's next government avoid friction with Washington on Middle East peace.

Under the coalition deal with Mr Barak, an administration led by Mr Netanyahu's right-wing Likud would respect all of Israel's international agreements, a Labour Party negotiator said - a formula that includes accords envisaging Palestinian statehood.

Mr Barak, an architect of Israel's recent Gaza offensive, is to retain his post as Defence Minister. Labour's Central Committee voted its approval of the coalition deal after a stormy debate.

Some 57 per cent of nearly 1,200 delegates backed their leader's call to join Mr Netanyahu's Cabinet, senior party official Eitan Cabel told the assembly of the often fractious party.

"The Central Committee has decided, and done so clearly," Mr Cabel said. "We'll do all we can to go in united."

"I am not afraid of Bibi Netanyahu," Mr Barak, using his new partner's nickname, told the assembly in a shaky, emotion-filled voice during the earlier debate.

"I will not be anyone's fig leaf," he said, dismissing talk that Labour would have little say on policy. "We will be a counterweight that will ensure we do not have a narrow right-wing government."

Mr Netanyahu has shied away from declaring support for the two-state solution that is at the heart of US peace efforts.

Indirect acceptance of that goal and formation of a broad government that includes Labour, the moving force behind interim peace deals with the Palestinians in the 1990s, might keep him off a possible collision course with President Barack Obama.

The Labour-Likud pact, read out by negotiator Shalom Simchon at the Central Committee session, appeared to suggest a shift in focus in Israel's approach to peacemaking.