This is our gift to our peoples and the generations to come King Hussein of Jordan

Jordan is now the second Arab state to establish close relations with Israel since Egypt made peace in 1979.

In an emotional speech King Hussein said: "This is peace with dignity. This is peace with commitment. This is our gift to our peoples and the generations to come."

Mr Rabin spoke of his joy at establishing peace among soldiers and friends.

He said: "'It is not only our states that are making peace with each other today, not only our nations that are shaking hands in peace here in the [Wadi Araba].

"You and I, your majesty, are making peace here, our own peace, the peace of soldiers and the peace of friends."

The president praised Mr Rabin and King Hussein for their efforts to end hostilities over recent years.

In a barely veiled attack on Islamic extremists, President Clinton said opponents of peace "who cloak themselves in the rhetoric of religion and nationalism" would not succeed.

All Israelis except the extreme right-wing welcome the agreement. The Israeli Knesset (parliament) ratified it by 105 to three.

Many Palestinians, who make up 60% of Jordan's population, are angered and shocked by the peace deal which they believe fails to address their grievances.

The Palestinian Liberation Organisation has condemned the role accorded to Jordan in protecting Islamic shrines in East Jerusalem.

In Jerusalem and throughout the occupied West Bank, Palestinians held a general strike and demonstrations.

In Hebron, they burned pictures of King Hussein and there were clashes with Israeli troops in Nablus.

Hamas, which just eight days ago carried out a devastating suicide bomb in Tel Aviv killing 22 people, has accused President Clinton of double-standards and vowed to continue its campaign of violence "anywhere in the world".

Under the agreement, Israel and Jordan agreed to exchange territory and make the border conform to geographical landmarks.

The treaty opens the way for co-operation in trade, tourism, transport links, water resources and environmental protection. It also secures the Israel's longest land border.

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