European Union foreign policy chief Javier Solana warned Wednesday that it will be extremely difficult to have negotiations on the final-status of Palestine if Israel does not stop its settlements in occupied Palestinian lands.

"Realities on the ground have to change. I want to say it very clearly that settlements have to stop. We cannot enter in a process which is part of the way to determine by the end of the year 2008 if there is no clear commitment on the settlements," Solana told a conference on Palestine in the European Parliament.

"I think it will be impossible, very difficult to have negotiations on final status while the final status is changing prior to the negotiations," he said.

"I say that in front of my good friend," said Solana pointing to Ayalon Ami, minister in the Israeli prime ministers office, who sat next to the EU foreign policy chief.

Solana noted that six months have passed since the Annapolis conference on the Middle East which has declared that a solution to the Palestine question should be found by the end of this year.

"Half the time has gone. We still have six months to see if we can arrive to something important," said Solana.

The two-day conference titled "The Middle East: Challenges and Perspectives" which kicked off here Wednesday evening has been organized by the Socialist Group in the European Parliament.

"I dont think we have to be over optimistic" over the bilateral negotiations continuing between the Israelis and the Palestinians, said Solana.

He said the situation today in Gaza is still very difficult but he thanked the efforts of the Arab league and Egypt to see if something can be done on the way of intra-Palestinian reconciliation.

Soboh Ahmed, deputy minister of foreign affairs in the Palestine Authority, said we have 17 years of process but no peace, referring to the Madrid conference held in 1991 to resolve the Palestine question.

"We need less process and more peace," he said.

Ahmed noted that there were 582 checkpoints and roadblocks in the West Bank and said 196 people have died in Gaza in the last 12 months because they were unable to cross the Israeli checkpoints for medical treatment.

"We have 12 000 Palestinian prisoners in Israel today," he said.

Over 100 politicians, academics, journalists and civil society representatives from Middle East and EU countries, the United States and the UN are taking part in the conference the second organized on the Middle East by the Socialist Group.

Topics for discussion include peace talks between Israelis and Palestinians, regional challenges, economic questions, the environment and the role of culture and education in solving the conflict.

Socialist Group leader Martin Schulz, who opened the conference, said: "Change in the Middle East can only come about through rapprochement. This is why the Socialist Group wants to facilitate contacts between the main parties on the ground".

Three Iranian diplomats who were present left the conference hall as soon as Ayalon Ami started speaking.