SHARM EL-SHEIKH, Feb 8: Israeli Prime Minister Ariel Sharon and Palestinian leader Mahmoud Abbas ushered in a new era of hope for Middle East peace at a summit on Tuesday by calling a ceasefire to end four years of bloodshed.

Meeting in an Egyptian resort following a new US peace push in the region, both leaders said it was time to end the cycle of bloodshed, which has claimed some 4,700 lives.

"We have agreed with the prime minister to cease all acts of violence against Israelis and against Palestinians wherever they are," Mr Abbas declared at the summit in Sharm el Sheikh on the palm-fringed shores of the Red Sea.

"The calm that is currently prevailing in our territories signals the start of a new era, the start of a hopeful peace," he added.

Mr Sharon, in Egypt for the first time as prime minister, said he was ordering a complete cessation to military activities against Palestinians.

"We have an opportunity to turn our back on the bloody path imposed on us over the last four years," he said. But he cautioned that it was a "fragile opportunity" for peace, saying there were still 'extremists' waiting to derail the process.

Hamas declared that it was not bound by the ceasefire announcement.

Mr Abbas's declaration "expresses only the position of the Palestinian Authority. It does not express the position of the Palestinian movements," said Hamas spokesman Mushir al-Masri.

The meeting between the two leaders was the first top-level summit in more than four years, putting the seal on a growing rapprochement which began with the death of Yasser Arafat on Nov 11.

New US Secretary of State Condoleezza Rice, in Paris shortly after a trip to the Middle East, hailed the meeting.

"Success is not assured, but America is resolute: This is the best chance for peace we are likely to see for years to come - and we are acting to help Israeli and Palestinians seize this chance," she said.

The two men were pictured shaking hands amid a generally jovial atmosphere.-AFP