A U.S. security helicopter lands in the Muqata presidential compound in the West Bank city of Ramallah January 7, 2008. REUTERS/Hakam Al Wadood

JERUSALEM (Reuters) - Top Israeli and Palestinian negotiators, under U.S. pressure to start peace talks, met on Monday on a plan to begin tackling some of the thorniest issues after a month-long impasse over Jewish settlements.

Both sides said they hoped to announce agreement on how they will conduct so-called final status negotiations -- over borders, and the fate of Jerusalem and Palestinian refugees -- before U.S. President George W. Bush visits Israel and the occupied West Bank starting on Wednesday.

The talks in Jerusalem between Israeli Foreign Minister Tzipi Livni and former Palestinian Prime Minister Ahmed Qurie will be followed up on Tuesday when Israeli Prime Minister Ehud Olmert and Palestinian President Mahmoud Abbas meet.

Olmert and Abbas, at a U.S.-sponsored peace conference in Annapolis, Maryland in November, set the goal of trying to negotiate a statehood agreement before Bush leaves office in January 2009. But it is unclear how that can be accomplished with weakened leaders on all sides.

Since Hamas Islamists seized control of the Gaza Strip in June, Abbas wields little authority beyond the Israeli-occupied West Bank.

Olmert was weakened by the 2006 war in Lebanon and could face new calls to resign at the end of the month when a commission of inquiry issues its final report on Israel's deficiencies in the conflict with Hezbollah guerrillas.

Speaking in the West Bank town of Bethlehem earlier on Monday, Abbas said he would ask Bush during his first presidential visit to the West Bank to halt Jewish settlement activity for the sake of peace.

Bush has called settlement expansion on occupied land where Palestinians seek statehood an "impediment" and said he would raise the issue with Olmert.

Olmert last week ordered a de-facto halt to new Israeli projects in the West Bank, but has not called off plans to build hundreds of new homes in an area near Jerusalem known to Israelis as Har Homa and to Palestinians as Jabal Abu Ghneim.

Construction there has been the main source of disagreement with the Palestinians and has drawn fire from Washington.

Olmert has conditioned implementing any peace deal with the Palestinians on Abbas first proving his mettle against militants. While Abbas had made some progress on security, Israel said the Palestinians still had a way to go.

Under the plan for negotiations under discussion on Monday, Olmert and Abbas would continue to meet about twice a month in order to make decisions on specific issues that come up during the negotiations, Israeli and Palestinian officials said.

Livni and Qurie, backed by teams of experts, would conduct final-status negotiations, largely in secret.

Working groups would also be assigned specific issues, such as water or economic cooperation, the officials said.

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