The leaders also condemned the U.S. veto of a resolution backing a U.N. observer force to help protect Palestinians, saying the move "is in total contradiction with the responsibility of the United States as a sponsor of the peace process."
As expected, the Arab countries approved a $240 million aid package to finance the Palestinians' self-rule government in the West Bank and Gaza.
"In view of the limited time frame for this summit, we could not reach consensus on all issues," lamented Jordanian Foreign Minister Abdul-Illah Khatib.
In Washington, the Bush administration expressed its opposition to a boycott of Israel and lambasted as "totally unacceptable" Syrian President Bashar Assad's condemnation Tuesday of Israel as "a society more racist than the Nazis."
As for Iraq, those in attendance said the larger Arab countries were fearful of defying the United States and wanted to wait for a new plan by the Bush administration to revamp the 11-year-old sanctions policy. Secretary of State Colin L. Powell presented elements of the plan during his swing through the region last month.
"The rhetoric about Iraq has definitely softened since Colin Powell's visit," said Abdel Bari Atwan, a commentator and editor of a London-based Arabic newspaper, Al Quds al Arabi. "Many of the Arab countries are dependent on U.S. financial support and they will defer to the American initiative on Iraq."
The sanctions, imposed after Iraq's 1990 invasion of Kuwait, have been eroding in recent months. Flights have resumed between Amman and Baghdad. In November, Syria reopened an oil pipeline from Iraq. Egypt recently signed a free-trade agreement with Iraq.
Still, the lack of a robust and unified Arab resolution on the Iraqi sanctions was seen by many ordinary people in the Arab world as proof of Arab weakness. Except for the Palestinian situation, the humanitarian impact of the sanctions on the Iraqi people is the cause with the most popular appeal in much of the Arab world.
In a coffee shop in downtown Amman, where men played cards and smoked apple tobacco in water pipes, the television set was tuned yesterday to professional wrestling rather than the summit.
"Why watch the summit? Nothing comes out of it," groused Khalid Abu Hashem, 43, a vegetable merchant who was playing cards. "There have been hundreds of summits and still nothing ever happens."
A SHOCK FROM GADHAFI
The Jordanians got few glimpses of the visiting Arab dignitaries, who were whisked in limousines between the royal palace and the hotel conference center on roads that were barred to the public by tanks. The exception was Libyan leader Moammar Gadhafi, who endeared himself by stopping at a doughnut shop to buy a snack and chat with patrons, by lunching on shwarma, an inexpensive meat sandwich, at a snack bar, and by kicking a ball with some Jordanian children.
Famous for his eccentricities, Gadhafi still managed to shock with a long, rambling speech in which he reportedly said that Israel should be allowed to join the Arab League (when the issue of Palestinian refugees is settled) and that the Arabs spent too much time obsessing about Jerusalem.
"It is only a mosque," Gadhafi reportedly said of Al-Aqsa, the Muslim shrine in Jerusalem that is a source of contention. "Why does it matter where we pray?"
Although the Arabs have held emergency summits, yesterday's was the first regular conference since before Iraq invaded Kuwait in 1990. Most of the Arab countries joined the United States and Britain in the gulf war to boot out the Iraqis, but ever since they have been quarreling about how best to deal with Iraq.
'ENOUGH IS ENOUGH'
Arab diplomats said the Kuwaitis, backed by Saudi Arabia, were willing to support the lifting of sanctions only if they could be assured that Iraqi leader Saddam Hussein had repented for the invasion. Kuwait also wants answers about 600 Kuwaitis who may still be prisoners of war and progress on reparations that Iraq owes from the war.
"There is a sense that enough is enough," said one Arab diplomat. "It's 10 years and the Iraqis can be good boys now. But the Kuwaitis need some positive sign or confidence-building measure from the Iraqis."
Iraqis were angered and disappointed by the outcome of the summit. Afterward, Iraqi Foreign Minister Mohammed Sayed Sahaf told reporters: "The Kuwaiti delegation drove the summit to failure."
The Iraqis also wanted the Arab countries to endorse their demands to end the no-fly zones in the north and south of the country, which are patrolled by military aircraft from the United States and Britain.
The sanctions overhaul being drawn up by the Bush administration calls for the easing of sanctions for most products, but tighter monitoring at airports and borders to make sure no military goods get into Iraq. Under U.N. resolutions, the sanctions are to stay in place until Iraq gets rid of all weapons that threaten its neighbors.
Barbara Demick's e-mail address is foreign@phillynews.com.
