Arafat Says Israeli Settlement Violates Peace Pact : Mideast: The PLO chairman demands that building of homes for settlers on a West Bank hilltop be stopped.

JERUSALEM —  A fight between Palestinian villagers and Jewish settlers over a rocky West Bank hilltop grew into a full-blown crisis Wednesday between Israel and the Palestine Liberation Organization.

PLO Chairman Yasser Arafat demanded that work be halted immediately on the disputed land, which lies on the outskirts of El Khader village, south of Bethlehem. Arafat’s call was echoed by Cabinet ministers from Meretz, the left-wing bloc in Israel’s coalition government.

Arafat appealed to Western governments to intervene, sending a letter to consulates accusing Israel of violating the Israeli-Palestinian peace accord.

In a statement he issued condemning the ongoing construction of Israeli settlements in the West Bank, Arafat warned that “such a policy will only widen the gap between both peoples. It will not serve the peace process but deals it a severe blow, putting it in real danger.”

After a three-hour emergency session Wednesday night, the Palestinian Authority issued a statement saying that the settlement activity near El Khader violates the Israeli-Palestinian peace accord and must be stopped. In the statement, the authority demanded that Israel stop enlarging settlements in the West Bank, but it did not say what action it will take if settlement activity continues.

On Tuesday, soldiers dragged and pushed about 200 Palestinian demonstrators from the hilltop, after settlers uprooted olive tree saplings the villagers had planted to protest the project. Saeb Erekat, the Palestinian Authority’s minister of municipal affairs, was kicked and punched by soldiers during the clash.

Bulldozers continued to clear the site Wednesday under the armed guard of dozens of Israeli soldiers. Villagers watched the work from a distance, chanting nationalist songs and waving the Palestinian flag. As night fell, hundreds of villagers built campfires and pitched tents, determined to sleep on the site.

“The Israeli government is digging the foundation for a new settlement and, at the same time, digging a grave for the whole peace process,” said authority Minister of Information Yasser Abed-Rabbo, who visited the disputed site Wednesday.

In the Knesset, Israel’s parliament, Meretz members urged Prime Minister Yitzhak Rabin to immediately halt construction. Environment Minister Yossi Sarid and Minister of Culture and Communications Shulamit Aloni said the planned settlement posed a threat to the peace process.

But Benjamin Netanyahu, leader of the Likud opposition bloc, blasted the government for even considering a halt to construction.

“What we have here is a humiliating bowing before a PLO dictate,” Netanyahu told Israel Radio. “Because 20 Arabs laid flat on the ground and Arafat lifted a finger, the government has to lay flat like a rug?”

Rabin asked for a review of the legal status of the property, where the settlement of Efrat wants to build a 500-home neighborhood. The report will be presented to the Cabinet on Monday, said Oded Ben-Ami, Rabin’s spokesman. Ben-Ami said construction will continue at the site until then.

Foreign Minister Shimon Peres telephoned Arafat on Wednesday in an effort to defuse the crisis, said Foreign Ministry spokesman Daniel Shek. Shek denied press reports that Peres promised Arafat that construction would be halted during the review.

A spokesman for Efrat expressed confidence Wednesday that the project will be proved legal and that work will proceed. “Let them take it to the Supreme Court,” said Menachem Spitz, a member of the Efrat municipal council. “We have all the documents to prove ownership.”

Spitz noted that the planned construction is funded privately and will use no state funds.

The Israelis first declared part of the site to be state land--meaning that it has no owner--in 1983. The land was turned over to Efrat in 1993. Villagers insist that the hilltop belongs to El Khader, and that it is the only hilltop available to the village for building homes.

Efrat is one of the more successful Jewish settlements in the West Bank. Within easy driving distance of Jerusalem, the settlement is spread across a string of hilltops. A planned community, it boasts luxurious villas, townhomes and apartments.

Many of its residents are immigrants, professionals from North America and South Africa.

Spitz said there are already 500 families waiting to move to the site.