In the 1990s the pressing need for a peace in the area brought the two-state idea back to centre stage. At one point in the late 1990s, considerable diplomatic work went into negotiating a two-state solution between the parties, including the Oslo Accords and culminating in the Camp David 2000 Summit, and follow-on negotiations at Taba in January 2001. However, no final agreement was reached.
Variations include a Palestinian state in all of the West Bank and Gaza Strip or some portion thereof. In some proposals raised in talks with the Palestinians there would have been territorial adjustments involving some small sections of current Israeli territory.
Some hold that the two-state solution was implemented in 1922 when Britain split off the eastern 75% of the Mandate to create Transjordan which became Jordan, a state with an Palestinian Arab majority population.
Some Israeli politicians, such as prime minister Benjamin Netanyahu, argue for a form of two-state solution in which a Palestinian state is granted most of the attributes of an independent state but denied certain aspects of sovereignty that might allow it to threaten Israel. Netanyahu argues, for example, that the future state's ability to import arms should be restricted. The Palestinian leadership does not view such proposals as being in the true spirit of the two-state solution concept.
Possible two-state solutions have been discussed by Saudi and US leaders. In 2002, Crown Prince (now King) Abdullah of Saudi Arabia proposed the Arab Peace Initiative, which garnered the unanimous support of the Arab League. President Bush announced his support for a Palestinian state, opening the way for UN Security Council Resolution 1397, supporting a two state solution. Christian communities in Israel also back the solution.
In a 2007 poll of adults in the Gaza Strip and the West Bank by the Jerusalem Media & Communication Centre, 46.7% of respondents favored a two-state solution, followed by 26.5% for a binational state. However support is lower among younger Palestinians; U.S. Secretary of State Condoleezza Rice noted: "Increasingly, the Palestinians who talk about a two-state solution are my age."
At the Annapolis Conference in November, 2007, the three major partiesPalestinians (Fatah but not Hamas government in Gaza), Israelis, and Americansagreed on a two-state solution as the outline for Israeli-Palestinian conflict negotiations. Nevertheless the problems of such a solution are in the details of mainly three topics with great differences of view between the participants, namely the status and borders of Jerusalem and its Temple Mount, the borders of the future Palestinian state, and Israeli settlements in the West Bank and the return of the Palestinian refugees.
Among Israelis, main objections are fears about security without the Jordan valley and full Israeli airspace and frontier control, the Jewish historical religious adherence to the Judean Hills (the name for the mountain range of the Judea region upon which Jerusalem and several other biblical cities are located) with the Palestinian population centers there[citation needed] (comparable to situation of Serbs and Albanians in Kosovo), Jerusalem as the postulated capital of two states, the "fingers" of Israeli settlements deeply in the Judean hills with at least three to four practical non-contiguous and non-self-sustainable enclaves of Palestinian population centers as well as the future of localities inhabited by Jews in the West Bank.
Most of these topics have been integrated in the peace proposal of the Geneva accord by Israeli and Palestinian peace activists, elaborated and signed under Swiss auspices. But until now it has not been a discussion directly between the Israeli and Palestinian governments. The more Israeli settlements are built in the West Bank, the more difficult this demographic pressure makes the finding of a peace solution acceptable to both sides.
As of 2009, both United States and European Union gave clear messages that the Israeli government, failing to abide by the "common agenda" of two-state solution, would not be acceptable itself. In March 2009, European ministers urged new Israeli government led by prime minister-designate Benjamin Netanyahu to accept Palestinian state or face "consequences".
On June 4, 2009, President Barack Obama delivered a major address to the Muslim World in Cairo, Egypt. In the speech, he supported the two-state solution.
"For decades, there has been a stalemate: two peoples with legitimate aspirations, each with a painful history that makes compromise elusive. It is easy to point fingers for Palestinians to point to the displacement brought by Israels founding, and for Israelis to point to the constant hostility and attacks throughout its history from within its borders as well as beyond. But if we see this conflict only from one side or the other, then we will be blind to the truth: the only resolution is for the aspirations of both sides to be met through two states, where Israelis and Palestinians each live in peace and security." - President Barack Obama.
On June 14, 2009, Israeli Prime Minister Benjamin Netanyahu gave a speech at Bar Ilan University, where he, for the first time in his career, endorsed the establishment of a Palestinian state west of the Jordan River. He called on it to be demilitarized.
On July 19, 2009, Netanyahu said "United Jerusalem is the capital of the Jewish people and the State of Israel," and "Israeli sovereignty in the city is indisputable." while Palestinian negotiator Saeb Erekat countered with "The job of the Israeli Prime Minister should be to prepare his people for what it takes to make peace," and "He knows very much that there will never be peace between Palestinians and Israelis without East Jerusalem being the capital of the Palestinian state."
It wont happen ! What say you?