The Starting point for a permanent settlement of the Israeli-Palestinian dispute is mutual recognition of the right of both peoples to full national life in the area between the Jordan and the Mediterranean. In order to promote peace and reconciliation between the two peoples, Israel should adopt the following principles:

• The Palestinian people have the right to self-determination, including the right to establish its own state alongside the State of Israel.
• The Green Line will constitute the guiding line for the determination of the permanent borders between the State of Israel and the Palestinian State.
• Israeli settlers in locations which, after the determination of the permanent borders, fall within the Palestinian State, will be able to return to Israel and will receive appropriate compensation. It will not be possible to achieve a permanent agreement without evacuating settlements. During the negotiations the two sides will determine those settlements in which Israeli settlers may remain; settlers will be required to recognize and respect Palestinian sovereignty.
• The permanent agreement will provide security arrangements enabling the Israel Defense Forces to protect the security of Israel. These security arrangements will include, inter alia, the demilitarization of the Palestinian State with regard to certain types. Israeli and Palestinian authorities will cooperate against hostile elements from within the Palestinian state who pose a threat to Israeli security.
• Jerusalem will not be divided. It will be recognized that members of both nations live in the city, and that both have national and religious rights. The area of the city will be redefined and agreed and coordinated municipal frameworks will be established within its borders in order to enable each community to manage its own internal affairs. Two capitals will exist within the municipal area: the capital of Israel in the Jewish areas, and the capital of Palestine in the Arab areas. The status of the holy sites will be determined through negotiations based on maintaining the religious rights and freedom of worship of all religions.
• The permanent settlement will include a comprehensive solution of the problem of the refugees (from 1948) and the dislocated residents (from 1967). The Palestinian State will be entitled to absorb refugees within its borders according to its own considerations. A compensation arrangement for refugees will be agreed upon with international support. After such agreement is reached, the parties will categorically waive any further claims for the return of refugees, restitution of property rights or the right of settlement in the area of the other state.
• Improving the economic conditions and well being of the residents of Israel and Palestine will help to stabilize and consolidate the peace agreement. Israel will advocate joint management of natural and environmental resources and economic cooperation with the Palestinian State. The framework and scale of cooperation between the two states will reflect the needs and capacities of each. Borders will be open to the passage of goods and workers as agreed upon by the two parties. Israel will actively support the Palestinian economy and will help recruit international support and investments to promote economic development of the Palestinian State.