Israeli forces withdrew from Beit Jala overnight, completing the withdrawal at about 6 am. There were reports of sporadic gunfire in the area this morning. Palestinian sources claimed the Israeli withdrawal was a military victory for the Palestinians. This morning East Jerusalem Fatah leader Ahmed Rinayem charged that IDF forces had not fully withdrawn from the Palestinian town. IDF tanks and troops remain camped on Beit Jala's outskirts.

Last night, the Israeli "kitchen cabinet" -- Prime Minister Ariel Sharon, Defense Minister Benyamin Ben-Eliezer and Foreign Minister Shimon Peres -- along with several ministers and military officials, decided after a three-hour meeting to withdraw IDF forces from Beit Jala. Government sources expressed skepticism about the durability of the truce arranged between Peres and PA Chairman Yasser Arafat, and said that if the shooting resumed, the IDF would return to the town for a longer period. Reportedly a cabinet decision would not be required for the IDF to return.

The unwritten understanding reached between Peres and Arafat, reportedly with mediation from European diplomats, called on Palestinians to cease their gunfire attacks on Gilo and for Israeli forces to withdraw from Beit Jala. Implementation of the agreement was delayed as Palestinians continued their gunfire, despite reported instructions from Arafat to stop firing at Gilo and vacate their positions.

Shooting on IDF positions in Beit Jala and the surrounding area resumed after a several-hour pause, and continued throughout the evening, until 22:00, when it stopped again. Israeli Channel Two television reported that the fierce renewed shooting, both before and after the cease-fire deadline, came from the "Abu Ali Mustafa Brigade," consisting of Popular Front militants, apparently formed in the wake of the elimination earlier this week of the Popular Front leader by an Israeli missile in Ramallah. The group took credit for the renewed fighting, and said that it did not recognize the cease-fire.

The IDF responded with tracer fire and occasional tank shelling. Palestinians reported that an IDF shell hit a cinema house in Bethlehem, causing six injuries.

The kitchen cabinet, under intense diplomatic pressure, opted to withdraw to the edge of town, despite deep skepticism about the ability and desire of the Palestinian Authority to maintain quiet in the area. However, Defense Minister Benyamin Ben-Eliezer told Channel One that even if the IDF leaves Beit Jala, it would not hesitate to return if the shooting resumes.

IDF Radio quoted defense sources as saying that if the IDF was compelled by renewed fire to re-enter the town, it would stay longer and dig in deeper.

Maj. Gen. Amos Gilad, Coordinator of Government Activities in the Territories, said in a briefing Wednesday that Israel's priority is to prevent any future fire on Jerusalem, which he called a "red line" which Israel could not allow to be crossed: "No nation can accept fire on its capital, not America, Washington, and not England, London," he said.

After the IDF presence quieted shooters in Beit Jala, fire on southern Jerusalem came from Bethlehem, including, reportedly, at least one of the mortars that fell on Gilo. Sharon said in a closed briefing that the firing from around Bethlehem was an attempt by Arafat to drag him into that town, which is adjacent to Beit Jala, Israel Radio reported. But the prime minister said he would not be dragged into such a situation, with all of its sensitivity to Christians. Entering Bethlehem with ground troops, he said, would have negative international implications for Israel.

However, left wing Israeli politicians claimed that Sharon was already stuck in Arafat's web. Speaking in the Knesset Wednesday, opposition leader Yossi Sarid (Meretz) said, "I am sure that the Palestinians are very satisfied," he said. "They are saying: 'Come Sharon. Come into our trap.'"

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