Updated: Netanyahu calls on Abbas to defeat Hamas

Israeli Prime Minister Benjamin Netanyahu, in a keynote speech today in which he said he would accept a Palestinian state under certain conditions, said the leadership of the Palestinian Authority must defeat Hamas Islamists who reject interim peace accords.

"They must decide between the way of peace and the way of Hamas," Netanyahu said. "The Palestinian Authority must impose law and order ... and overcome Hamas. Israel will not negotiate with terrorists trying to destroy it."

President Mahmoud Abbas's Palestinian Authority runs the Israeli-occupied West Bank but its Hamas opponents seized control of the Gaza Strip two years ago.

But a spokesman for Abbas dismissed the speech saying it was "sabotaging" peace efforts.

"Netanyahu's remarks have sabotaged all initiatives, paralysed all efforts being made and challenges the Palestinian, Arab and American positions," said Nabil Abu Rdainah, noting Netanyahu's demand that Jerusalem be the undivided capital of Israel and that Palestinian refugees not be allowed into Israel.

"This will not lead to complete and just peace," Abu Rdainah said. "His remarks are not enough and will not lead to a solution."

Highlights from Netanyahu's speech

PALESTINIAN STATEHOOD, WITH CONDITIONS

"The territory in Palestinian hands must be demilitarised -- in other words, without an army, without control of airspace, and with effective security safeguards ...

A fundamental condition for ending the conflict is a public, binding, and honest Palestinian recognition of the state of Israel as the nation state of the Jewish people.

If we receive this undertaking, for demilitarisation and the security arrangements required by Israel, and if the Palestinians recognise Israel as the nation state of the Jewish people, we will be prepared for a true peace agreement, to reach a solution of a demilitarised Palestinian state alongside the Jewish state.

WEST BANK SETTLEMENTS

We have no intention of building new settlements or of expropriating land for new settlements. But there is a need to allow settlers to lead normal lives, to allow mothers and fathers to raise their children like all families around the world.

PALESTINIAN REFUGEES

The Palestinian refugee problem must be resolved outside the borders of the state of Israel. On this, there is a broad international consensus.

I believe that with goodwill, and international investment, this humanitarian problem can be solved once and for all.

TERRITORIAL HANDOVERS BY ISRAEL

Many a worthy person has told us that withdrawal is the key to peace between us and the Palestinians ... But the fact is that every withdrawal has been accompanied by rockets and suicide attacks.

That claim purporting that withdrawal will bring peace with the Palestinians, or at least bring it closer, has so far not been borne out in practice.

JERUSALEM

Israel needs defensible borders and Israel's capital, Jerusalem, will remain united.

ABBAS VS. HAMAS

They must decide between the way of peace and the way of Hamas. The Palestinian Authority must impose law and order ... and overcome Hamas. Israel will not negotiate with terrorists trying to destroy it.

ARAB REGIONAL ENGAGEMENT

I appeal, from here this evening, to the leaders of the Arab states and say: Let's meet. Let's talk peace. Let's make peace. I am willing to meet with you any time, any place -- in Damascus, in Riyadh, in Beirut."