Celebration Festive excitement made it to the tiny West Bank village of Jifna when Santa Claus - and a traveling Christmas puppet show - visited the local Catholic school. The BBC News website joined the community as it celebrated what some say is the best Christmas since 2000, when the Palestinian uprising, or intifada, began.

Restrictions Jifna is a village of about 1,200 people. With Palestinian Christians making up an estimated three quarters of its population, it is one of the few places in the overwhelmingly Muslim West Bank to have a Christian majority. Although Jifna has never experienced the level of violence seen in other parts of the West Bank, its residents suffer from travel restrictions and economic hardship. They live near the city of Ramallah, which has seen some heavy fighting.

Excitement The Christmas performance began with blaring dance music and disco lights. Imad Atallah (right) from the Operation Palestinian Children and Youth (OPCY) team says that, despite long days travelling around the West Bank, he never gets jaded because of the excitement that greets them. "Each time is like the first," he says.

Festive spirit "During the intifada, there was no Christmas," says youth worker Khader Anton Abu Khalil (left). "Christmas to the children is gifts, outings, Santa and getting chocolate and money, but people were unemployed and everything was closed. "Now, if you look at the faces, they're all laughing. They feel it is Christmas."

Learning traditions The mischievous puppet boy Marwan (right) is one of the team's favorite characters. He is convinced Christmas is a celebration of Santa Claus' birthday, but learns about Jesus' birth from Santa when he finds him to sing Happy Birthday. The aim is to educate Palestinian Christian children about their religious tradition. In this area it becomes a cultural label from birth.

Clowning about Although the Christmas program is for Palestinian Christians, much of the team's work is among Muslims. Many West Bank Palestinians say Christians and Muslims live "like brothers". However, team leader Diana Saman says she has visited villages where children have never met Christians. "The fact that they see us... that breaks a lot of barriers," she says.

New experience The children were soon dancing along to the team's songs. Ms Saman says some younger West Bank children are initially scared by the puppets because there is so little children's entertainment available. In one place, when they tried to do actions to music the children "just froze". "They had never had anything like this before," she says.

Nativity joy No child's Christmas is complete without a nativity and there was great enthusiasm among the girls when brightly colored angel wings were provided. Mary, clad in a Muslim-style headscarf, did a sterling job with a cardboard box for a manger. This is despite the plastic baby Jesus' head being barely attached to his body.

Confrontations Politics is never far away here. These boys' first reaction to the camera was to pose with their Palestinian scarves. Youth worker Mr. Abu Khalil says that although the worst days of the intifada are behind them, there are still confrontations between Israeli soldiers and stone-throwing youths, often close to the school playground. "The younger children get terrified," he says.

Aggression "Of course the intifada has affected the children's behavior," says Mr. Abu Khalil. "The most common game is 'soldiers and Arabs' where they hold sticks as guns and throw stones. "Even small kids, when they see a jeep coming, hold stones to protect themselves. "The children are aggressive with each other. Most of this generation is aggressive."

Mother's hope Jifna mother Mary Salameh says that although things are better, Israeli travel restrictions mean there are still few places she can take her children aged 10, 12 and 15. "We hope to see Bethlehem," she says. "I've never been able to take them there." This is despite Jesus' birthplace being physically only about 90 minutes drive away.

Gifts for Christmas Finally, amid much good-natured commotion, Santa Claus appeared. He distributed packs containing practical items such as towels and toothbrushes, together with sweets and a video CD of Christmas cartoons. One boy brandished a sponge, giggling, as he walked away with friends into the early evening darkness.

Word and pictures by the BBC's Heather Sharp.

When Israel launched a 34-day offensive against Hizbullah fighters in Lebanon, it justified its action by saying it had no choice in responding to the capture of two Israeli soldiers. Last night, a retired Israeli judge, Eliyahu Winograd, produced a coruscating indictment of three men - the prime minister, the defence minister and the former army chief of staff - for launching the war last summer.

A war which killed up to 1,200 Lebanese, the majority civilians, and nearly 160 Israelis was ill thought out. The decision to respond to the capture of Israeli soldiers by Hizbullah on July 12 with an intensive military strike was not based on a detailed military plan. Other options were not considered. Ehud Olmert made up his mind hastily, without consultation outside the army, without studying the problems of the Lebanese front, and without considering alternatives. He then added his own over-ambitious goals and, even once it was clear things were not going as planned, he did not adapt his plans. All this added up to a "serious failure in exercising judgment, responsibility and prudence".

The conclusions of the interim report (there is more to follow in the summer) should be enough to spell the end for any serving prime minister. The Israeli army's impulsive chief of staff, Lt Gen Dan Halutz, has already fallen on his sword. It is widely assumed that the defence minister, Amir Peretz, described as lacking experience, will not survive a leadership battle in the Labour party. Mr Olmert's days should now also be numbered, except that the prime minister has told cabinet members from his party, Kadima, that he has no intention of going. Mr Olmert is not going to contest the inquiry's findings. His tactic instead is to spread the blame - as happened in Britain when Lord Butler reported: if everyone is to be criticised, then everyone is to blame and no one should go.

This is at best a shabby evasion of responsibility and will do little to stop the words of the Winograd report gaining resonance as the weeks and months unfold. Mr Olmert is playing on the knowledge that Kadima is not ready for his resignation. His able and cautious foreign minister, Tzipi Livni, is unwilling, for now, to mount a challenge. If a snap election were called, Benjamin Netanyahu, the Likud leader, would clean up, so Mr Olmert is playing for time. But these are internal calculations. Israel, which has so often justified its refusal to negotiate with the Palestinians on the grounds that there is no one sensible and in power to talk to, now has a leader whose judgment is revealed as fatally flawed. For once, it is the Palestinians who lack a partner for peace.

Israel today described as "interesting" a land-for-peace deal agreed by Arab nations at a major summit in Saudi Arabia, promising to examine it more closely.

The plan, which would see members of the Arab League recognise Israel and guarantee its security in return for the country returning to its 1967 borders, was also "the possible basis for a dialogue", a government spokeswoman, Miri Eisin, said.

"We're not being more specific than that because we need to really sit down and study it," she added.

According to the Palestinian president, Mahmoud Abbas, his own citizens are "sincere in extending the hand of peace to the Israeli people, and I call on that people and its leaders to share that dream with us".

The final resolution, expected to get formal approval before the summit closes later today, also makes a direct appeal to Israel's population to accept the plan.

According to a draft version, the summit will "call on the government of Israeli and the Israelis at large to accept the Arab peace initiative and seize the available opportunity to resume direct and serious negotiations on all tracks".

The initiative, first put together at a summit in 2002, has won uniform acceptance from Arab leaders gathered for the two-day event in Riyadh, but could yet founder, with Israel expressing doubts about the extent of territorial withdrawal and the possible return of large numbers of Palestinian refugees to their former homes.

Israel says it could accept the offer with certain changes, but some Arab leaders have, thus far, refused to amend it.

The issue will now be put to a series of summit working groups, that will seek to drum up support for the deal from the US, UN and Europe. American allies Saudi Arabia, Egypt and Jordan hope the smaller groups will also prove more flexible over the details of the plan.

The quartet of Middle East peacemakers, the EU, US, Russia and the UN, are also set to become involved.

Speaking today in Brussels, the EU foreign policy chief, Javier Solana, said quartet negotiators hoped to meet both their Israeli counterparts and those from major Arab nations "in the next few weeks".

The Arab unanimity over the deal was due in large measure to Saudi Arabia, which bridged its quarrels with Syria and persuaded the Palestinian Islamists of Hamas to stay onside.

The initial offer in 2002 was ignored by the west and Israel at the height of the second intifada, and was then overshadowed by the Iraq war.

The plan's revival represents the broadest possible Arab support for a permanent accommodation with Israel.

But its cautious hopes have not been matched elsewhere. The summit has no chance of breaking the political deadlock in Lebanon, and nor is it likely to go beyond platitudes about Darfur and Somalia. But the event symbolises Saudi Arabia's return to an active Middle Eastern role.

Last month, King Abdullah brokered the Mecca agreement between Mr Abbas and Hamas, paving the way for the creation of a Palestinian unity government.

Hizbullah militants broke international humanitarian law during the recent conflict with Israel, an Amnesty International report concluded today.

The report said Hizbullah had violated law by firing thousands of rockets into Israel and killing dozens of civilians during the fighting.

The human rights group called for a UN investigation into violations committed by both sides during the 34-day conflict, but the report published today focused on the actions of the Lebanese militant organisation.

Hizbullah launched nearly 4,000 rockets into northern Israel during July and August, killing at least 39 civilians.

The firing of rockets into urban areas violated international law calling for distinction between civilian and military targets, Amnesty said.

"The scale of Hizbullah's attacks on Israeli cities, towns and villages, the indiscriminate nature of the weapons used, and statements from the leadership confirming their intent to target civilians, make it all too clear that Hizbullah violated the laws of war," the Amnesty secretary general, Irene Khan, said.

"The fact that Israel has also committed serious violations in no way justifies violations by Hizbullah. Civilians must not be made to pay the price for unlawful conduct on either side."

The militants fired imprecise rockets packed with thousands of metal ball bearings to maximise harm to civilians, the report found.

It is Amnesty's most severe condemnation of Hizbullah since the conflict, which began in July, and comes after the group accused Israel of violating international law with indiscriminate and disproportionate attacks on civilian targets in Lebanon.

Today's report - called Under Fire: Hizbullah's attacks on northern Israel - was based on field research in Israel and Lebanon, interviews with victims, official statements and discussions with Israeli and Lebanese government officials and senior Hizbullah figures.

Amnesty has previously called on Hizbullah to release two kidnapped Israeli soldiers and abstain from targeting civilians.

Violence between Israel and Hizbullah erupted after the militant group kidnapped two Israeli soldiers in a cross-border raid on July 12.

The ensuing fighting killed more than 1,000 people. Most were Lebanese civilians, and around one-third of those were children, UNICEF said.

Nicole Choueiry, a UK spokesman for Amnesty, said the group planned to publish additional reports into whether Hizbullah contributed to civilian deaths in Lebanon by deliberately hiding amongst civilians.

A: There are ideas being talked about between the Egyptians and the Israeli side, but I have no information about that. There are certain efforts going on but nobody has any idea.

Q: There have been reports that he might be released.

A: They are just rumours. I don't think there is something really serious going on. It will take a longer time. I have no information about what has been published.

Q: There is a big economic crisis in Gaza. What is your government doing about this?

A: The reason for this is the siege caused by the American and Israeli embargo and the way the Europeans dealt with it. This is because of the democratic choice of the Palestinian people. The government has taken a big effort to solve this problem. We are paying part of the wages for the education ministry; even today we are paying the teachers part of their wages. But the problem is complicated with the embargo and the siege.

Q: Many people here and in your movement feel there has been a loss of direction among the Palestinians. Do you feel that?

A: We know what we want. We want to liberate our land. At the same time we want a stable economy, natural and open relations with the world, to end all the chaos on Palestinian land. But the problem is not what we want but to have the world standing by us, helping us to achieve that.

Q: There are many now who say there should be a national unity government and one minister from your government tried to resign yesterday over this. What happened?

A: We are in favour of the creation of a national unity government. This is our choice. But yesterday's resignation had nothing to do with it. I refused his resignation. It is possible that he will come [to the cabinet meeting today]. His resignation is over now. It is not accepted.

Q: What is stopping you from forming a national unity government? What are the hurdles?

A: We are not talking about problems, only procedures to complete the discussion. I hope this will be completed in a short time.

Q: It is said you are going to make an announcement later this week?

A: Yes. It will be a comprehensive speech, about the whole thing. That will be one of the subjects.

Q: If a national unity government is formed does that mean Hamas will recognise Israel?

A: The national government has a programme that relates to the adjusted prisoners document.

Q: In that programme will there be a recognition of Israel?

A: The programme is the prisoners' document. You can read it yourself.

Q: In a new government will you remain prime minister?

A: There will not be a problem to select the prime minister. The majority in the parliament will head the government.

Q: Hamas will continue to lead the government?

A: This is the agreement with the president.

Q: Do you think the international community, America and Europe, will accept that and give the money that has been frozen?

A: First of all, everybody has to respect the choice of the Palestinian people. The European position is more positive than the American position.

Q: But you're confident that even if Hamas remains at the head of a national unity government that the money that has been stopped will come to the Palestinian Authority?

A: That's what we talked about with President Abu Mazen [Mahmoud Abbas]. He was optimistic that this would happen.

Q: Going back to Gilad Shalit, do you think that the operation to capture him was a mistake considering the damage that has been done?

A: It happened. The Israeli aggression was too big for this kind of an operation. The Palestinian people knew the big operation by the Israelis was not about the soldier, it was to eliminate the government.

Q: Do you feel that Israel wants to eliminate your government?

A: It is very clear, yes. We have $300-400m held by the Israelis and it is our money. What do you think? That would have solved our salary problems here. The taxes and all these imports and exports.

Q: Many of your senior politicians from the legislative council, including the speaker of parliament, have been arrested. How badly has that affected your ability to run a government?

A: This assures again that Israel is keen to eliminate this government. This has happened for the first time, the arresting of all these people with no excuse whatsoever, bypassing democracy. The danger of all this is to create a political vacuum. That can lead to chaos and a situation even more dangerous than we are in now. It can push people to lose hope in the agenda of democracy and political activities and that is what we don't want.

Q: Do you think they might be released under some kind of agreement with the Israeli government?

A: They have to be released. They are political prisoners. They are all politicians. These people are elected by the Palestinian people.

Q: One year ago when the settlers left Gaza there was an opportunity for Gaza to grow more prosperous. Do you feel that opportunity has gone?

A: We cannot lose hope. What kills these dreams is the occupation.

Q: There is talk at the UN General Assembly this month that there will be a new peace initiative. Does this have a chance of success?

A: There is a proposal already - the Beirut initiative. Nobody told us what's going to be in this new initiative. It all depends on the Israeli position.