President Shimon Peres, visiting Egypt on Sunday, sidestepped Egyptian President Hosni Mubarak’s declaration the Arab world agrees that all of eastern Jerusalem must be part of a future Palestinian Authority state.

President Peres replied, "I have a clear message to the Arab world: we do not intend to build in the Temple Mount. We respect Muslims and I regret the mask of rumors and lies” alleging Israeli activity on the holy site. Arab media repeatedly have alleged that the Jewish State is excavating underneath the site in order to bring about the collapse of the al-Aqsa mosque.

Mubarak insisted, "Jerusalem is not only a Palestinian problem but it is an issue that concerns all Muslims around the world. If we don't find a solution to Jerusalem... Israel will make enemies of all Muslims around the world.

President Peres said he does not deny there are gaps between Israel and the Arab world but reminded his host that all of Jerusalem is under Israeli sovereignty and any change in its status requires the approval of the Knesset.

Mubarak praised the veteran Israeli leader for visiting Egypt. The Egyptian leader has never visited Jerusalem except for the funeral of former Prime Minister Yitzchak Rabin.