PLO Chairman Yasser Arafat, fresh from his emotional visit to Gaza and Jericho, held talks in Paris on 6 July with Israeli Prime Minister Yitzhak Rabin about the next steps in the peace process.

The two leaders and Israeli Foreign Affairs Minister Shimon Peres were in Paris to receive a UN Educational, Scientific & Cultural Organisation (UNESCO) award for their September 1993 peace accord.

Rabin said after his first session of talks with Arafat that the first phase in the peace agreement has been completed successfully. He said it had been agreed to set up three committees to discuss the next phases. The first issue to be addressed will be the redeployment of Israeli forces in the West Bank. The PLO has made clear it wishes Israeli troops to be moved from the main West Bank towns soon. Israel is seeking to link any redeployment to Palestinian elections.

Arafat said the Palestinians want to hold elections as soon as possible. The plan is for this to be in October. Arafat said former US president Jimmy Carter has agreed to help supervise the polling.

The PLO is also seeking early progress on the release of some 6,000 Palestinian prisoners. Arafat has made a special request for the early release of Sheikh Ahmad Yassin, head of the Islamist Hamas group. Israel says any such release depends on Yassin pledging to renounce violence.

After these issues have been settled, the two sides are due to embark on the sensitive issues of Jewish settlements in the occupied territories and the status of Jerusalem.

Arafat's visit to Gaza and Jericho was welcomed by US Secretary of State Warren Christopher, who said in Geneva on 5 July that the visit was 'thrilling'. He said he expected to meet Arafat during his forthcoming Middle East peace mission, that will start on 17 July.

Positive news for the peace process has also come on the economic front. Ahmad Qoreia (Abu Ala), the Palestinian official in charge of economy and trade, said in Tunis on 5 July that talks with the World Bank and the US administration in Washington at the end of June had been very positive. He said the World Bank had agreed to make available sufficient funds to cover the Palestinian National Authority's budget deficit for the third quarter of 1994. He also said the bank had allocated $150 million for urgent infra-structure projects in Gaza and Jericho.