The inability of Tzipi Livni to form a coalition government in Israel and her subsequent calling of elections has sadly obscured two unexpected peace proposals that emerged in her final weeks of horse-trading. The first was an examination by the Foreign Ministry into a possible nonaggression pact with Lebanon. The second comes after Labor leader Ehud Barak proposed a revival of Saudi Arabia’s 2002 peace plan which offers Israel universal recognition in the Arab world were it to fully withdraw to its pre-1967 borders.

The forthcoming election battle between Kadima, Labor and Likud will no doubt lead to a simplification of foreign policy issues into a case for engagement or disengagement with the Palestinians and Israel’s Arab neighbors. However, these two plans deserve closer analysis given they represent a key choice that Livni will face if she succeeds in defeating Benjamin Netanyahu for the premiership in February: Whether to persist with Israel’s traditional bilateralism in dealing with the Arab world, or adopt a more multilateral approach.

With the exception of the 1991 Madrid conference, which then Prime Minister Yitzhak Shamir only reluctantly attended after serious economic pressure from the US, the Israeli government has always preferred to handle Arab states individually. The new Lebanon proposal is a continuation of the bilateral approach. It advocates a cease-fire agreement in which the Lebanese government would rein-in Hezbollah in exchange for an end to airspace violations and negotiations over remaining occupied territory.

Whether part of a Syrian deal or not, the Lebanon proposal typifies the current division within the Israeli peace camp: Those who favour a “Syria/Lebanon first” approach to peace, and those who advocate pushing the Palestinian track. Both groups advocate bilateralism.

Reports that Shimon Peres and now Ehud Barak have recently been promoting the multilateral 2002 Saudi peace plan are therefore quite surprising. Barak has been misquoted a little; he actually wants, “to introduce a comprehensive Israeli plan to counter the Saudi plan” rather than fully backing Riyadh’s proposals. However, his renewed support for what he calls “regional peace”, rather than a continued focus on the bilateral Syrian and Palestinian negotiations still represents a marked departure in Israeli diplomatic strategy.

However, the Arab world in 2008 is not what it was in 2002, and there is doubt over whether the Saudi plan could be made to work were the Israelis genuine in wanting it. One particular obstacle is the renewed cold war between Syria and Saudi Arabia — two states that would be vital players in any agreement.

With Syrian President Bashar Assad’s international stock seemingly on the rise, following support from Qatar, Turkey and France, he may question the merit of handing Saudis the diplomatic victory of playing arbiter in any regionwide resolution. Moreover, Bashar has already made clear that the key player in any negotiation will be the incoming US administration, which he hopes can provide Arab states with a substantial financial peace dividend, despite the current economic crisis.

It is with some irony, then, that if Livni (or Barak) triumphs in February, Israel might shift away from a bilateral approach at the very time when the most vocal critic of bilateralism, Syria, is seemingly changing its tune.

The Syrian envoy to Washington admitted this week that disunity and lack of political coordination in negotiations with Israel was the “sad reality in the Arab world”.

As has been seen many times before, this disunity is allowing whoever becomes prime minister the luxury of choice in its approach to the Arab world.