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Following the 6-day war of 1967, the Israel unity government declared on June 19, 1967 that it was ready to return the Golan Heights to Syria, Sinai to Egypt and most of the West Bank to Jordan, in return for peace treaties with its Arab neighbors, normalization of relations and guarantee of navigation through the Straits of Tiran. The refugee problem would be solved by resettlement outside the borders of the State of Israel. On the same day, the USSR submitted UN General Assembly resolution 519, calling for immediate Israeli withdrawal from all territories, with no mention of peace or negotiations. The resolution was voted down on July 4.
In the wake of the Arab defeat, eight Arab heads of state attended an Arab summit conference in Khartoum, Sudan held August 29 - September 1, 1967. It formulated the Arab consensus that underlay the official policies of most Arab states for the next two decades and beyond, with the exception of Egypt: " no peace with Israel, no recognition of Israel, no negotiations with it." The same policy had been followed, officially, since the 1949 armistice negotiations following the Israeli victory in the 1948 war (the War of Independence) despite behind the scenes efforts at a settlement. This appeared to be the Arab answer to the Israeli call for a negotiated settlement based on the principle of land for peace. At the same time, the conference gave up the petroleum embargo on the West. The embargo was inspired by the kind of thinking enunciated by Egyptian President Gamal Abdul Nasser, in his speech following the Egyptian defeat in the 6-Day War. Nasser had blamed the Israeli victory on alleged air-support provided the United States, and proclaimed bitterly, "The Sixth Fleet runs on Arab Petroleum." The resolutions also called for a fund to assist the economies of Egypt and Jordan, and a new agreement to end the inter-Arab war in Yemen. Egypt broke the "no negotiations, no recognition" taboo after the 1974 October War. Syria and Libya led the "refusal front" which refused to recognize UN resolution 242 or to negotiate peace with Israel.
The Khartoum resolutions weakened conciliatory voices in the Israeli government, and legitimized those voice who were calling for annexation of the conquered territories and Jewish settlement in them. They argued that in any case, it was clear that the Arabs would not make peace in the near future, and that the settlements would establish "facts on the ground" (a literal translation of a Hebrew phrase that means fait accompli) and would pressure Arab governments and Palestinians to make peace. Consequently, on September 24, the unity government led by PM Levi Eshkol, under pressure from the National Religious Party, the Gahal (later Likud) party of revisionist Menahem Begin and labor party activists, announced plans for the re-establishment of a Jewish community in the Old City of Jerusalem (exiled in 1948 by the Jordan Legion) of the Etzion Bloc ( kibbutzim on the Bethlehem-Hebron road wiped out by Palestinians in the war of 1948)and for kibbutzim in the northern sector of the Golan Heights. Plans were also unveiled for new neighborhoods around Jerusalem, near the old buildings of Hebrew University, and near the Hadassah Hospital on Mount Scopus. This phase of the settlement plan was well within Israeli the consensus. Jerusalem was always considered a part of Israel, and Israelis were bitter at the destruction of the Jewish community of the Old City, with had existed for over 400 years. The Etzion bloc and other areas around Jerusalem were considered to be part of the "corridor" and necessary to protect Jerusalem from a repeat of the 1948 Arab blockade.
Much later, King Hussein revealed that from the Arab standpoint, the resolutions of the Khartoum conference were intended to be conciliatory, and to allow for informal de facto negotiations and recognitions. From his point of view, they were a victory for the moderate point of view espoused by himself and by Gamal Abdul Nasser, who had just experienced a smashing defeat and was not prepared to go to war.
However, the Israeli side could not know this at the time, and article 3 speaks for itself:
The Arab Heads of State have agreed to unite their political efforts at the international and diplomatic level to eliminate the effects of the aggression and to ensure the withdrawal of the aggressive Israeli forces from the Arab lands which have been occupied since the aggression of June 5. This will be done within the framework of the main principles by which the Arab States abide, namely, no peace with Israel, no recognition of Israel, no negotiations with it, and insistence on the rights of the Palestinian people in their own country.
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The conference has decided to expedite the elimination of foreign bases in the Arab States
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