Israeli Prime Minister Ariel Sharon has recently met with Palestinian Finance Minister Salam Fayyad, senior government sources said on Monday.
The meeting was held at Sharon's residence in Jerusalem, the sources said, without revealing the date of the talks.
During the meeting, Sharon and Fayyad exchanged views on the current situation and ways to end violence and resume peace talks, the sources added.
Fayyad, a former international banker��has been widely hailed bythe United States and other Western peace brokers for launching financial reforms in Palestinian institutions.
The Palestinian minister has been regarded as a top candidate for a new post of Palestinian prime minister.
Last Friday, Palestinian leader Yasser Arafat announced readiness for the appointment of a prime minister to head a future cabinet as a key reform measure.
Under a draft peace "roadmap," worked out by the so-called Quartet Committee, composed of the United States, the European Union, the United Nations and Russia, the Palestinians are supposedto form an "empowered reform cabinet with the office of prime minister."
Arafat had declined to appoint a prime minister, obviously fearing that the premiership would weaken his power.
Israel Radio reported on Monday that Sharon has viewed Arafat's decision as "positive."
The radio quoted Sharon as saying that if Arafat succeeds in defusing the Palestinian-Israeli tensions, Israel would offer an opportunity to implement its political plans.