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CHARLES GIBSON, HOST: Mr. Prime Minister, the president described the meetings today as frank and productive. We’re told you might be able to add the words „blunt” and „testy.” Is that fair?

BENJAMIN NETANYAHU, ISRAELI PRIME MINISTER: I’d say frank and productive. They were very good. I’m glad the president invited the prime minister of Israel, myself, and the leader of the Palestinian Authority, Mahmoud Abbas, for this meeting. We’ve been calling for five months for a meeting to get the peace process moving forward and I’m glad it’s finally happened.

GIBSON: The president said a few months ago, for the peace process to go on, the settlements have to stop. Do you get the sense that the White House might accept some sort of a limited freeze? And are you willing to offer one?

NETANYAHU: Look, I think the issue of settlements is something that belongs to the final negotiations. It can’t prejudge the negotiations. It can’t be resolved before we even begin to talk about it.

I’ve said that I’m willing to meet Palestinian leaders anytime, anywhere, and I’m glad that this obstacle seems to be removed and we can get on with the business of forging a lasting and secure peace between us. At least I hope that’s the case.

GIBSON: If that condition has been removed, I don’t know it. It has been
a precondition as far as the Palestinians were concerned to come to the
table. You have preconditions. They have preconditions. One of them is
that settlements stop.

NETANYAHU: I think putting on preconditions is a way to make sure that the peace process does not move forward. For 16 years, Israelis and Palestinians have been negotiating. There has been robust  construction of communities and settlements throughout. Nobody place this precondition. And I think placing it right now is to make sure that the peace process does not go forward.

The issue of the settlements has to be resolved. It should be resolved at the end of negotiations, not before the negotiations. And the sooner we put it aside and start moving and talking about how do we actually live next to one another, how do we have the Palestinians live next to Israel without threatening Israel, without having the territories that are ceded to them become bases for thousands of rockets that have already been launched at Israel from other places that we vacated? If we can get this idea of mutual recognition and security, then we’ll
have a solution to all the problems, including the problem of settlements.

GIBSON: But Mr. Prime Minister, are you saying unequivocally, you will not offer any kind of a freeze – limited, full, any kind of a freeze – on settlements as a precondition to talks?

NETANYAHU: I said that I would look to reconcile two things. One is to start the peace process again, something that I’m glad – I hope that we started today. And, second, to enable normal life to continue. There are a quarter of a million people living in these communities. You know, they need kindergartens. They need schools. They need health plans. They’re living. I’m committed not to build new settlements. I am committed not to expropriate additional land for existing settlements. But people have to live. You can’t freeze life.

So there is a way, I think, to relaunch the peace process and not get bogged down with this question, because we’ve just wasted six months on this issue. We could waste another six months. I think that’s not good. I want to move on to peace… And I think the sooner we put this to the side, the quicker we can move forward toward peace.

GIBSON: Would you take some kind of a freeze for eight months or 12 months, since I understand that was discussed today?

NETANYAHU: No, we actually didn’t get into these discussions. And I’m sure if there’s a will to relaunch the peace process, you’ll find me committed to that. Anytime there’s an Arab leader who has genuinely committed to peace, such as Anwar Sadat, we made peace. That was a Likud government under Menachem Begin.

When Yitzhak Rabin, the Labor prime minister, met the late King Hussein, who wanted peace, we made peace. If the Palestinian leadership says we want peace, we recognize Israel as the Jewish state, the nation state of the Jewish people, just as we’re asked to recognize the Palestinian state as the nation state of the Palestinian people. If you recognize Israel’s right to exist as the Jewish state and if we have the necessary security arrangements of demilitarization, I think we’ll move to peace. And that’s the winning formula for peace – a demilitarized Palestinian state that recognizes the Jewish state. That’s something that I have united the country behind and we can move forward and get on with it. And get on with peace.

GIBSON: A former Israeli prime minister, the great Abba Eban, used to say about the Palestinians, they never miss an opportunity to miss an opportunity. If you take this position on settlements, aren’t you missing an opportunity?

NETANYAHU: Well, you know, we’ve had peace negotiations when settlements were being built without any limitations. I have made certain suggestions on how to move forward and I think the Palestinians have to understand, here’s a government in Israel that unites the political spectrum. It wants peace. It wants to move ahead with peace. It wants a genuine peace, a defensible peace, one in which the Palestinians recognize Israel and Israel has the necessary security. But we want the Palestinians to live next to us in dignity and also in prosperity and security.

This is an opportunity. Don’t waste it. Don’t squander this opportunity by discussing the issues – issues that will only block the progress of the negotiations. Let’s go. Let’s move.

GIBSON: But I come back to the point. You have preconditions, they have preconditions. But not making some move in the direction of their preconditions, aren’t you missing an opportunity or don’t you run the risk of missing an opportunity?

NETANYAHU: No, Charlie, I said no preconditions on the beginning of negotiations. I said I’m willing to go anywhere, anyplace to meet any Arab leader and, first of all, the Palestinian leaders, to move toward peace. I certainly think we have certain foundations for those negotiations to succeed. I think the Palestinians have to recognize Israel as the Jewish state and I think we need security.

But I didn’t place any conditions on beginning the negotiations. And it’s precisely those preconditions on negotiations that have stymied our progress so far.

So I’m glad President Obama called this meeting today. I hope it puts aside the question of preconditions. Everybody said they’re not placing preconditions. I’m not and I hope the Palestinians don’t. I think we have to move on with the business of peace.

GIBSON: If talks were to resume, would it be your position that they have to start totally from scratch or could they start with past Israeli-Palestinian agreements as a foundation?

NETANYAHU: I think there have been a lot of discussions and obviously there’s a record here. I myself made agreements with the Palestinians when I was prime minister. There have been other agreements. And quite apart from that, there have been negotiations – theoretical discussions.

So we’re committed to what was formally negotiated as binding agreements by previous Israeli governments. We will consider other ideas, but we have ourown mandate. And that mandate is from the broad public in Israel that says we want a real peace. You know, we don’t want a peace where we hand over territory which becomes a race for Iran’s proxies so they can fire thousands of rockets on us.

We want a real peace. You know, we don’t want a peace where we hand over territory which becomes a base for Iran’s proxy so they can fire thousands of rockets on us. We want real peace. We’re one of the tiniest countries in the world.

Now, if you’re the size of Monaco or the size of Luxembourg, that by itself doesn’t pose a security problem. But if your neighbors also say, „We’re going to destroy you or throw you into the sea and fire thousands of rockets at you,” that does pose a security problem. So, Israel wants both recognition and security from its neighbors, and this will be the task of the negotiations in the coming months.

And you know what, Charlie? I believe that with good will and with courageous leadership on the Palestinian side, we can achieve it. And I think Mahmoud Abbas has a great choice to make. We all do. But he has to decide: is he going to be an Arafat or an Anwar Sadat? If he’s an Anwar Sadat, he’ll find in me a partner for peace and we’ll make peace.

GIBSON: On your condition, or under your definition of accepting formal agreements, I’m curious. Are you saying – where does that put Oslo? Where does that put Annapolis? Are those bases for future discussions, or do you go back to the beginning?

NETANYAHU: Well, Annapolis was an agreement, was a declaration. Rather than get into these questions, I think we just – let’s get on and move with it. There are plenty of things to do. We could  pick – nit-pick – at previous agreements.

I said today in the meeting with President Obama and Mr. Abbas, I said, „Look, we could hurl accusations at each other from here to eternity. There’s no point. I mean, we could waste more time. Let’s just sit down and discuss the most basic things of how we achieve a peace between the Israelis and the Palestinians. How do we ward off the terrorists and the Iranian sponsors? How do we establish a climate of prosperity, legitimacy and security that will serve the purposes of both the Israelis and Palestinians and the broader concern for peace that good people – good-intentioned people – well-intentioned people everywhere share?”

GIBSON: Mr. Prime Minster, just a couple of questions, if I may, on Iran. Earlier this year, you and President Obama were in agreement, giving Iran until the end of the year to negotiate. Is that still the timeframe?

NETANYAHU: I don’t want to discuss whether we need another week or another month. The crucial question is, what’s the goal? And the president assured me time and again that the goal is to prevent Iran from developing a nuclear weapon. And I think that’s the right goal. There is a growing awareness in Washington, I believe in European capitals and elsewhere, that the development or acquisition of Iran of nuclear weapons is something that endangers world peace.

Iran is the major sponsor of world terrorism. Now, imagine what terrorism could be if the terrorists had a patron that gave them a nuclear umbrella, or worse, if that patron actually gave them nuclear weapons. That’s a nightmare scenario, and we all have to ensure that it doesn’t happen.

GIBSON: Our intelligence services, your intelligence services, struggle with the issue of how close they are to having nuclear weapons and how close they are to delivering them. How close do you think they are?

NETANYAHU: They’re getting closer. There’s no question about that.

GIBSON: And what does that mean? The Iran government right now is in turmoil. Does that make them more dangerous or less?

NETANYAHU: I think this regime is a lot weaker than people thing, and I think the civilized countries are lot stronger than they tend to think about themselves. This regime tyrannizes its own people, guns them down when they peacefully protest for freedom.

So, the application of external pressure, I think, would not coalesce the people of Iran with the government. It will actually coalesce them against the government, because they truly detest this regime. So, I think Iran is susceptible to pressure today. It’s highly dependent on the importation of refined petroleum. There are other things that could be done to weaken this regime, and they should be done quickly. If not now, when?

GIBSON: But my question is, do you think the weak government in Iran, to use your term, becomes more dangerous or less?

NETANYAHU: I think that it becomes more dangerous if it becomes stronger. And it becomes stronger if it develops nuclear weapons. The experience of such regimes is that once they pass a threshold, then you can have even a primitive society – and there’s one in Asia – that is almost an anthill society developing nuclear weapons and all of a sudden it becomes important like China or Japan – but much more dangerous. And I don’t think Japan or China are dangerous.

To have the ayatollah regime acquiring nuclear weapons, no matter how weak they are today, tomorrow they will be a hell of a lot stronger. And that is something that would threaten the peace of the world. It should not be allowed to happen.

GIBSON: You say they are close, in your mind. Is there a point where it becomes impossible for Israel to live in the shadow of a nuclear Iran?

NETANYAHU: I’m not going to deal in hypotheticals. Of course, every country reserves the right of self-defense and Israel is no exception.

But as I’m pointing out today, the development of nuclear weapons by Iran would pose an enormous problem to the stability of the Middle East, to the flow of oil from the Middle East, to the security of my country, to the possibility of having terrorists enjoy a nuclear umbrella or having – or receiving, actually, nuclear weapons from this Iranian regime.

There are so many reasons, endless reasons why this should not be allowed to happen. And it’s time the international community acted in unison to make sure that it doesn’t happen.

GIBSON: But you say they are close. Doesn’t that take it out of the realm of the hypothetical?

NETANYAHU: I think there is a growing understanding in the major capitals of the world – virtually in all of them – that it’s important, that it’s an international issue, an international concern to make sure that Iran does not develop nuclear weapons.

GIBSON: The international community has been reluctant to impose sanctions. You went to Moscow earlier in the year to talk about supplying air defense weapons to Iran. Do you really think that the rest of the world community is now any closer to putting the kind of pressure that you discussed against Iran on them?

NETANYAHU: Well, I’m not going to refer to press speculations about this or that visit. But I’ll tell you what I say to all the world leaders that I meet, including in today’s meetings and the meeting I had with President Sarkozy. And that is that because time is getting shorter, because Iran is moving ahead to develop nuclear weapons, the international community has to act in a much tougher way.

And I think the best thing to do is to apply what I think Secretary of State Hillary Clinton called crippling sanctions on Iran. Believe me, the regime is susceptible to it. I think people know what the nature, the true nature of this tyranny is about. And the application of this pressure might do the job. The sooner we do it, the sooner we’ll find out and the less will be the need to take stronger actions.

GIBSON: Mr. Prime Minister, appreciate it.  Thank you for your time.