Abbas visits Olmert's home talking peace

JERUSALEM, Dec. 27 (UPI) -- Israel's annexation of East Jerusalem was the key topic for peace talks Thursday between Palestinian and Israeli leaders in Jerusalem, officials said.

Palestinian President Mahmoud Abbas was to meet with Israeli Prime Minister Ehud Olmert at his official Jerusalem residence for the first time since the U.S.-brokered summit in Annapolis, Md., late last month, Haaretz reported.

Prior to the meeting Palestinian media said two issues are considered deal-breakers by Abbas: Israel's decades-old annexation of East Jerusalem, which Palestinians want as a capital of their eventual state, and Israel's construction of new settlements inside the so-called Green Line near East Jerusalem.

Negotiating teams from both sides have met twice since the Annapolis meeting and each time ran into roadblocks on the issues, the newspaper said.

Other issues the two leaders could discuss included the removal of checkpoints in the West Bank, the Hamas control of the Gaza Strip and Palestinian prisoners in Israeli jails, officials told Haaretz.

U.S. President George Bush is scheduled to visit the region in January with a goal of encouraging both sides to move forward.