July 25, 1994 Rabin and King Hussein at White House sign declaration ending state of war between Israel and Jordan.
Massacre and withdrawal1994 In February, an extremist Jewish settler killed 39 Palestinians as they prayed in a West Bank mosque. Tensions were high. Nevertheless, Israel withdrew in May from Jericho on the West Bank and from Gaza. In July, Arafat entered Gaza and swore in members of the Palestinian Authority, which took control of education and culture, social welfare, tourism, health and taxation.
Rabin assassination1995 In September, Rabin and Peres signed an agreement expanding Palestinian self-rule in the West Bank and giving the Palestinian Authority control over six large West Bank towns. Rabin was assassinated at a peace rally two months later by an Israeli law student with connections to right-wing extremists
Pivotal elections1996 In the first-ever elections held by Palestinians, Arafat was the overwhelming choice as president of the Palestinian Authority. In Israel, a massive bus bomb set off by Islamic extremists killed 25 and wounded dozens in the run-up to the prime minister election. Hard-line Likud Party leader Benjamin Netanyahu defeated Peres in a close race. Netanyahu and Arafat pledged to work toward a final peace treaty. The Israeli government decided later that year to end a freeze on construction in the occupied territories. Clashes continued between Palestinians and Jewish settlers.
Handover, housing and Hamas1997 The West Bank town of Hebron was returned to Palestinian control after 30 years under the Israelis. But Netanyahu approved a large new Jewish housing project in eastern Jerusalem. New violence broke out. Among the incidents were the detonation of suicide bombs in an outdoor market in Jerusalem that killed 15 and wounded 170. An extremist Palestinian group called Hamas claimed responsibility, and the Israeli Cabinet insisted the peace talks would continue only when the terrorism ended.
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