HA’ARETZ 1. US TO ISRAEL: ALLOW RESIDENTS OF EASTERN JERUSALEM TO PARTICIPATE IN PA ELECTIONS. 2. ASSESSMENT IN FATAH: BARGHOUTI WON’T RUN FOR CHAIRMAN. HATZOFEH 1. Murderer Barghouti to run for Palestinian Authority Chairman. ARAFAT’S REPLACMENT TO BE ELECTED ON JANUARY 9. Assessment: Good chance that Abu Mazen – Arafat’s replacement as PLO Chairman – will be elected. Abu Ala will not run. Arafat burial: Wild funeral, without order and without control of crowd. IDF keeps tight closures only on Nablus and Jenin. 2. BRIG.-GEN. ZAKAI’S REPLACEMENT TO BE CHOSEN TOMORROW; ASSESSMENT: BRIG.-GEN. EYAL TZUR. Five brigadier-generals competing for post. 3. SUICIDE TERRORIST FROM NABLUS TURNS HIMSELF IN DUE TO FAMILY PRESSURE. 4. SATISFACTION IN PM SHARON’S BUREAU OVER BUSH’S REMARKS REGARDING HIS CONTINUED SUPPORT FOR DISENGAGEMENT. MA’ARIV 1. First gesture: Sharon allows PA policemen to carry guns. BURIED. It began with organized trip from Cairo and ended in mass riot in Mukata yard. Accompanied by 200,00 Palestinians, Yasser Arafat was buried at Mukata. President Bush: “I will devote myself to establishment of Palestinian state.” YEDIOT AHRONOT 1. Sharon outraged over extensive television coverage. Soon: Bush to send Powell to region. Barghouti supporters: Let him run in elections. HELPING ABU MAZEN. US and Europe mobilizing to help Palestinians hold elections. Israel: We will allow freedom of movement. IDF allows Palestinian policemen to carry weapons. PM: We will make concessions if they foil terrorism.

______________________________ SUMMARY OF EDITORIALS FROM THE HEBREW PRESS Hatzofeh suggests that, “The Palestinian masses do not yet accept the existence of Israel as legitimate,” and asserts that, “The majority of Palestiniabs have still not yet internalised that the Jewish People have a right to a Jewish State in the Land of Israel.” The editors believe that Israel will thus be unable to make any lasting peace with its neighbors until there is, “genuine, heartfelt recognition of the Jews’ right to live here in a Jewish state.” Yediot Ahronot discusses Finance Minister Benjamin Netanyahu’s proposed capital market and banking reforms. BPI-info