A DETAILED peace agreement concluded yesterday between Israel and Jordan could bolster broader peace moves in the Middle East and open an era of unprecendented economic cooperation between the two neighbors.
The comprehensive accord includes plans for major capital works projects such as dams and desalination plants.
Following an unannounced visit to Amman, Jordan, early yesterday, Israeli Prime Minister Yitzhak Rabin and King Hussein painstakingly worked through a draft agreement that contains a series of complex compromises on land disputes and water rights.
Jordan has claimed that Israel diverted more water than it was entitled to from the Yarmouk River, which borders Israel, Jordan, and Syria.
At a meeting between Rabin and King Hussein last week, the two leaders discussed international financing for the $125 million construction of two dams on the Jordan and Yarmouk rivers - as a way to share much-needed water in the area.
``There is an important economic dividend in this peace accord, and it has firmly established the role of Jordan in shaping a new regional order,'' says Jordan Times editor George Hawatmeh.
Jordan had demanded the return of 152 square miles of desert and farmland that Israel seized after the 1948 Middle East war.
Israel has agreed to return most of the land demanded by Jordan, but Jordan agrees to lease certain lands that include Israeli settlements or farms back to Israel, Western diplomats said.
The breakthrough also has immediate implications for Palestine Liberation Organization Chairman Yasser Arafat, still reeling from last week's kidnapping and killing of an Israeli soldier by the militant Islamic group Hamas.
The offensive by Islamic extremists, which has growing popular support among Palestinians, has diverted his energies to confronting Hamas and cracking down on its activities, while trying to retain his Palestinian support-base.
Mr. Arafat, who has repeatedly accused Israel of pursuing a policy of divide and rule in its dealings with King Hussein, is still smarting from the July 25 recognition by Israel of the King's custodianship of Muslim holy sites in Jerusalem.
Further evidence of a Jordanian-Palestinian power struggle emerged Sunday, when Jordan and the Palestinians each appointed a mufti, the highest Islamic authority in Jerusalem. Jordan appointed a leading Muslim jurist, Sheik Abdul Qader Abdeen, as chief cleric of Jerusalem, a largely political post.
The Palestinians do not recognize Jordan's jurisdiction of the holy sites, insisting that they are on Palestinian land in East Jerusalem. Arafat announced he was for the first time appointing the mufti and named Akroma Sabri to the post, a spokesman said.
And yesterday's agreement further bolsters King Hussein's status as a major player on the Palestinian stage.
About 60 percent of Jordan's population of 4 million are Palestinians and about 800,000 Palestinians with Jordanian passports live on the Israeli-occupied West Bank.
The accord could also increase pressure on Syrian President Hafez al-Assad, who is resisting Israeli terms for a separate peace deal between Israel and Syria.
Negotiations have foundered over the future status of the Israeli-occupied Golan Heights, and a recent Middle East tour by Secretary of State Warren Christopher failed to achieve a breakthrough on the Syrian track.
``I hope that this accord will help negotiations for a similar agreement between Syria and Israel. What we need is to extend peace to the whole region ... otherwise it can be torpedoed by states that are not part of an overall accord,'' Mr. Hawatmeh says.
Mr. Christopher's visit to Jordan last week appears to have paved the way for the successful two-day summit that began on Sunday and lasted through the night until both the two leaders had ironed out remaining differences.
Jordan has been under growing economic pressure to normalize relations with Israel since the 1990 United Nations trade embargo against Iraq that overnight cut off its cheapest source of oil supplies and a market for nearly 25 percent of Jordanian exports.
The embargo forced Jordan to buy more expensive oil from Yemen and Syria and to seek a framework for cooperation with Israel, diplomats here say.