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DATE=10/09/00

TYPE=CORRESPONDENT REPORT

TITLE=LEBANON / SITUATION (L-O)

NUMBER=2-2-26766

BYLINE=EDWARD YERANIAN

DATELINE=BEIRUT

CONTENT=

VOICED AT:

INTRO: U-N representative to Lebanon Rolf Knutsson met with Lebanese President Emile Lahoud and Hezbollah leader Sheikh Hassan Nasrallah before heading to Israel to meet U-N Secretary General Kofi Annan. Russian Foreign Minister Igor Ivanov also arrived in Beirut to help resolve the crisis between Israel and Hezbollah, which holds three Israeli soldiers captive. Edward Yeranian reports from Beirut.

TEXT: U-N representative Rolf Knutsson said he is optimistic about the chances of a prisoner exchange between Israel and Hezbollah, involving Lebanese prisoners held in Israel and three Israeli soldiers captured Saturday by Hezbollah.

Mr. Knutsson said Sheikh Nasrallah has given me information that I will share with the other parties. Mr. Knutsson plans to relate this information to U-N Secretary General Kofi Annan and Israeli officials.

The U-N representative asked Lebanese President Emile Lahoud to deploy additional Lebanese troops in the south. Mr. Knutsson said that would allow the Lebanese government to take complete control of the region in accordance with U-N resolutions. The Lebanese government has consistently refused to deploy its army throughout southern Lebanon until Israel withdraws from a border strip called Shebaa Farms.

Israel maintains that the disputed territory, which it occupied during the June 1967 Seven Day War, belongs to Syria. Hezbollah guerillas captured three Israeli soldiers inside the disputed Shebaa region on Saturday.

A series of weekend artillery duels, which left a number of Lebanese civilians wounded, was the first serious flare-up on the Lebanese-Israeli border since Israel withdrew from southern Lebanon last May. Israel has threatened to take military action against Lebanon and Syria if its soldiers are not released soon.

Meanwhile, Russian Foreign Minister Igor Ivanov said all necessary measures should be taken to avoid an aggravation of the current crisis in the Middle East. (SIGNED)

NEB/EY/GE/RAE