President Bush, commenting Thursday in Jerusalem, spoke out in favor of the creation of an independent Palestinian state. He followed that strong suggestion with another: financial compensation for Palestinian refugees forced to leave their homes in areas that are now part of Israel.

BBC:

Mr Bush said in a statement: “It is vital that each side understands that satisfying the other’s fundamental objectives is key to a successful agreement.”

He said this would require:

* secure recognised and defensible borders for Israel
* a viable, contiguous, sovereign and independent Palestinian state

He added: “Agreement must establish Palestine as a homeland for the Palestinian people just as Israel is a homeland for the Jewish people.”

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