Ehud Olmert, the Israeli Prime Minister, issued a surprising response last night to the Arab peace initiative, inviting Arab leaders to a regional summit to discuss the plan.

Mr Olmert had previously hinted that he would be open to such talks, but yesterday’s dramatic announcement was his strongest reaction yet to a renewed diplomatic drive around the land-for-peace deal.

His announcement came at a joint press conference with Angela Merkel, the German Chancellor and current president of the European Union, who was meeting Israeli and Palestinian leaders to kick start negotiations.

“I would take advantage of this important opportunity. . . to invite to a meeting all Arab heads of state, including, of course, the King of Saudi Ara-bia, whom I regard as an important leader, in order to engage in dialogue,” Mr Olmert said.

“I think it is time to make a momentous effort in order to give a push to the diplomatic process. I am optimistic.”

The Arab peace initiative proposes that the Arab world grant Israel diplomatic recognition in return for the establishment of a Palestinian state within the 1967 boundaries, with its capital in Jerusalem, and a “just solution” for four million Palestinian refugees.

Yesterday Mrs Merkel added her voice to a growing chorus of Western leaders urging Israelis and Palestinians to use the plan as a basis for future peace. Underscoring the potential for failure, Mrs Merkel said: “It is important to talk, but it is also important to turn the spoken word into deeds.”

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