Associated Press

July 11, 1994

TUNIS, Tunisia (AP) -- Yasser Arafat, on the verge of moving his home to the Palestinian self-rule areas, said Monday he will not rest until an independent state is established with its capital in Jerusalem.

Arafat, chairman of the new Palestinian National Authority established under a peace accord with Israel, spoke to about 1,000 Tunisian dignitaries who bade him farewell.

Arafat planned to leave Tunis Monday evening, fly to Egypt and then head to the Gaza Strip to take up permanent residence. He made a brief visit last week to Gaza and Jericho in the West Bank, the areas of limited Palestinian self-rule.

Tunis has been the headquarters of the Palestine Liberation Organization since an Israeli invasion force drove Arafat and his guerrillas out of Lebanon in 1982.

His farewell was a red-carpet affair, presided over by President Zine El Abidine Ben Ali, who presented Arafat with Tunisia's highest medal "in recognition of the just struggle of the Palestinian people for their homeland and in appreciation of your bravery and wisdom."

Arafat reciprocated by giving the Tunisian president a medal, the Star of Palestine. He thanked Ben Ali and his people for their

"help, hospitality and tolerance" and for "secret help in the negotiations" with Israel for Palestinian self-rule.

He did not elaborate.

"We will continue this struggle until the Palestinian flag will fly over all the Palestinian land and an independent Palestinian state is set up with Jerusalem is its capital," Arafat told the crowd at Tunisia's presidential palace. "It is a difficult battle," he conceded.

It is also an anathema to Israel, which considers Jerusalem its indivisible capital. Most Israeli government ministries and the parliament are in west Jerusalem. The Israelis captured east Jerusalem in the 1967 Arab-Israeli war, when they also took the Gaza Strip and West Bank.

PLO officials said about 200 officials and employees would leave Tunis Monday, flying to Egypt on a Saudi Arabian plane and then proceeding to Gaza.

Arafat told reporters late Sunday that the PLO's Political Department, which functions as a foreign ministry, would stay in Tunis to maintain ties with about 70 countries. Under the May 4 Israeli-PLO agreement, the Palestinian National Authority is banned from establishing foreign ties during a five-year interim self-rule period.

Arafat also said Palestinian self-rule would be jeopardized unless money promised for reconstruction and development arrives quickly.

"The promises are plenty, but real implementation on the ground ... is very little," Arafat said. He said unemployment in the Gaza Strip has passed 60 percent, throwing its people "under the red line of starvation."

END QUOTE