Palestinian Prime Minister Salam Fayyad announces that the Palestinian Authority intends to create a de facto state by 2011. Israeli Prime Minister Netanyahu continues his diplomatic meetings in Europe, meeting earlier today with UK Prime Minister Gordon Brown. An Israeli airstrike on a tunnel between Gaza and Egypt kills three Palestinians. The US State Department announces that it is approaching an agreement on the renewal of negotiations between Israel and the PLO. Fatah proposes a three-month truce with rival Hamas. The Independent looks at how the West Bank town of Nablus is flourishing under eased Israeli restrictions.