ABSTRACT
In early June 1974 the Palestinian National Council adopted a decision to set up a Palestinian authority in all areas eventually to be freed from Israeli rule. This move signaled for first time PLO willingness to retreat from the uncompromising demand for the liquidation of the State of Israel and the establishment of a Palestinian state in its stead. Paradoxically, one of the central factors that led to the transformation of the PLO from what was seen as an out-and-out terrorist organization into a recognized political entity with a legitimate stake in the solution of the Middle East problem, was the Palestinian recourse to terrorism outside of Israel. The damage to PLO political prestige was only one of negative effects that could be related to Palestinian terrorist activity outside of Israel. Thus, when Palestinian international terrorism targeted Arab interests, it sometimes caused deterioration in relations between the PLO and Middle East states.
