ARAFAT OPTIMISTIC FOR AGREEMENT

LONDON [MENL] -- Palestinian Authority Chairman Yasser Arafat has expressedoptimism for a peace agreement with Israel. Arafat said the continuation of peace talks with Israel can still leadto a peace agreement, despite the failure of the recent Camp David summit.Arafat made the statement during a meeting with Spanish Prime Minister JoseMaria Aznar in Madrid on Sunday. He also discussed with Aznar the future ofJerusalem, the return of Palestinian refugees and Palestinian water rights.