Israeli Prime Minister Ariel Sharon said yesterday that no negotiations were possible with the Palestinians as their leadership lacked the courage or ability to fight terrorism, in an address to parliament.

"There is no Palestinian leader with the necessary courage or capabilities to fight terrorism," the premier said.

"Accordingly no negotiations can take place with the Palestinians".

Sharon was speaking in a debate called by the opposition to draw out more details on his controversial plan to withdraw from the Gaza Strip.

The Gaza plan is part of a larger package of unilateral measures that Sharon has pledged to implement in the absence of any progress in the bilateral peace process with the Palestinians.

But his comments prompted anger among the Palestinians, who said peace would only come through negotiations between the two sides.

For Israel, "the only way to have peace is to negotiate with the Palestinians," Palestinian negotiations minister Saeb Erakat told CNN.

"Sharon's official announcement that he will stop negotiating with the Palestinians means the pursuit of authoritarian and aggressive policies, and this could be a dangerous escalation," he told the network.

"That is really very, very disturbing. The situation will only get worse and worse".

He also lambasted Sharon for scrapping a much-awaited summit with Palestinian prime minister Ahmed Qorei following twin suicide bombings in the southern Israeli port of Ashdod, and described the cancellation as "a fatal mistake".

Shortly after Sunday attacks that left 10 civilians dead as well as the two bombers, Sharon called off the summit, which was expected to take place today.

Sharon's disengagement speech was narrowly approved by the Israeli parliament by a majority of one.

Forty-six members of the 120-seat Knesset voted in favour, while 45 voted against the speech in which Sharon revealed very few details about the controversial plan.

The disengagement project will see the evacuation of all but a handful of the Jewish settlements in the Gaza Strip, and the strengthening of Israeli control over other settlements in the West Bank.

Sharon said he was still holding consultations with the military establishment and his allies in Washington, but he pledged to bring the completed package back to the Knesset at a later stage.

"When the government decides, once such a decision is made, we will put it to the Knesset for approval," he added.

Sharon also pledged an unstinting campaign against Palestinian militants after Sunday's deadly attacks.

"We will persecute the terrorists so that not a single killer who lays a hand on an Israeli citizen will get away with it," he said. – Sapa-AFP.