Israeli Foreign Minister Shimon Peres and Palestinian President Yasser Arafat arrived on the Spanish island of Majorca today for their first meeting since they reaffirmed a cease-fire deal in late September.
Mr Peres and Mr Arafat, attending a business conference in the resort of Formentor, found themselves at close quarters at a time when Israelis and Palestinians are facing intense international pressure to end a year of bloodshed.
In Washington today, a senior State Department official used unusually tough words on the Palestinians when he said their uprising against Israeli occupation had turned into "an ongoing process of calculated terror and escalation."
The US has been calling for a revival of talks in an effort to calm the conflict to help bolster Arab support for its military campaign against Afghanistan after the September 11 attacks on the United States.
Speaking at a conference organized by the Center for Policy Analysis on Palestine, US Deputy Assistant Secretary of State David Satterfield said Mr Arafat should crack down on the militant Hamas and Islamic Jihad groups - which he said had "darker interests."
Mr Satterfield played down expectations that the Bush administration was working on a Middle East peace initiative, saying the parties themselves needed a "vision" of peace.
In fresh violence, Palestinian gunmen shot and killed an Israeli man and wounded another near the Palestinian-ruled city of Ramallah in the West Bank, the Israeli army said.
In the south Gaza Strip, Israeli tanks and bulldozers thrust 400 meters into Palestinian-ruled territory, leveling the area and uprooting trees, witnesses and security sources said.