Tens of thousands of Palestinians gathered Wednesday to honour their iconic leader Yasser Arafat, with president Mahmud Abbas addressed the rally.

Palestinian president Mahmud Abbas renewed his demand for a complete Israeli settlement freeze at the rally.

The fifth anniversary of the iconic leader's death finds Palestinians more divided than ever and his successor Abbas pondering resignation because of stalled US-led peace efforts that have failed to create a Palestinian state with non-stop settlements.

Arafat, who died aged 75 in a French hospital on November 11, 2004, remains a beloved symbol of unity and resistance to Israel for the Palestinians, whose lands have been occupied by Israel for decades.

In 2004, while besieged by the Israeli military in his Ramallah headquarters, he fell ill with flu-like symptoms and was flown to France for treatment. He died in at Percy military hospital outside of Paris on 11 November 2004.

Five years on, the exact cause of Arafat's death still remains a mystery.

"Clear framework"

Abbas said U.N. resolutions called for there to be a "clear framework" for talks to end more than 60 years of conflict.

"We cannot go to negotiations without a framework. And we say the framework is U.N. resolutions, meaning a return to the 1967 borders," Abbas said. "What's new in this demand?

"We see Israel confiscating land, building settlements and Judaising Jerusalem with unprecedented speed... and then they ask that we return to negotiations," Abbas told he huge crowd.

"The return to negotiations depends on Israel adhering to the terms of reference of peace and that means halting all settlements, including natural growth and Jerusalem.

"It is our right to demand the removal of all settlements from our land because they are illegal," he added.

The Palestinian leader told the crowd he did not want to go into his desire not to seek a second term as president in a January election.

"On this occasion, I don't want to talk again about my wish not to run in the upcoming elections," Abbas said.

"As I said in my speech, there will be other decisions ... that I will take in light of coming developments," he said, referring to his announcement last week that he would not seek re-election.

He also said Israel was trying to thwart the internationally backed creation of a Palestinian state.

The crowd, waving Palestinian flags and banners of Abbas's Fatah party, crammed into the government compound that contains Arafat's tomb to honour the man who catapulted the Palestinian cause on to the world stage and led them through nearly four decades of armed struggle and peace talks.

A senior Palestinian security official estimated that tens of thousands of people had gathered in and around the Muqataa presidential compound, the headquarters of the Palestinian Authority and the site of Arafat's mausoleum.

"Collapse of Palestinian Authority"

Abbas has already said he will not seek re-election in a vote he has called for January.

Under Palestinian Basic Law, Abbas's resignation would have to be approved by two thirds of the Palestinian parliament. But the chamber has not convened since 2006 because most of the members are still in Israel jails.

If a resignation was approved, the speaker of parliament, Aziz Dweik of the Hamas movement, would assume the presidency until new elections were held within 60 days.

But aides have indicated in recent days that if Abbas steps down the entire Palestinian Authority could collapse, which would spell the end of the already defunct Oslo process and leave nearly four million Palestinians in Gaza and the West Bank once again dependent on Israel for basic services as an occupying power.

Arafat established Palestinian Authority during the Oslo peace process in the 1990s.

The Palestinians' demand for a complete freeze of Jewish settlements in the occupied West Bank and east Jerusalem was initially backed by Washington.

Abbas said he was surprised by Washington's retreat to stand by previous pledge to call for a complete Israeli settlement freeze.

Abbas's frustration was said to have peaked when US Secretary of State Hillary Clinton praised an Israeli proposal for some settlement limits as "unprecedented" after months of Washington demanding a full freeze.

Clinton later clarified that the Obama administration still considers settlements "illegitimate" but also called on the two sides to resume negotiations even without the freeze demanded by the Palestinians.

The roadmap calls on Israel to remove all outpost settlements erected after 2001 and to stop settlement expansion, but thus far Israel has not heeded US and international demands for a complete settlement freeze.

"Reconciliation"

Abbas also says hand extended for Hamas reconciliation

Abbas said his hand was extended to Hamas for reconciliation and called on Hamas to sign an Egyptian proposal to end their division.

"We have agreed to the Egyptian document and we call upon Hamas to accept it without procrastination," he said. "Our hand is extended for reconciliation."

The World Court has ruled all settlements illegal under international law. Palestinians, who want their own state in the West Bank and the Gaza Strip, see the settlements as a land grab as an occupier "state".


Agencies