Most of the Arab world formally recognized the independent state declared by the PLO's parliament-in-exile, but only a few countries outside the region extended diplomatic ties Wednesday.

The United States and many European countries, while ruling out recognition, said Tuesday's decision by the Palestine National Council was a positive step in trying to settle the Arab-Israeli conflict.The Soviet Union also said it would help find a solution in the Middle East, but held off recognizing the state, saying it has not been asked to extend diplomatic ties.

Israel rejected the declaration, saying it was an exercise in "ambiguity and double talk."

The 19 states that recognized the Palestinian homeland were Algeria, Bahrain, Iraq, Jordan, Kuwait, Libya, Qatar, Tunisia, Saudia Arabia, North and South Yemen, the United Arab Emirates, Bangladesh, India, Madagascar, Malaysia, Mauritania, Turkey and Indonesia.

Egypt, Morocco and Pakistan stopped short of extending diplomatic recognition but said they fully supported the move. The UAE upgraded its reaction Wednesday from strong support to full recognition.

Yasser Arafat, chairman of the Palestine Liberation Organization, announced the decision of the 450-member parliament-in-exile on Tuesday in Algiers, saying it declared "the establishment of a Palestinian state with Jerusalem as its capital, which will be for all Palestinians wherever they are."

The declaration did not define the state's boundaries, but it focused on the West Bank and Gaza Strip, which have been under Israeli military occupation since 1967.

China said in its first official response that its government and people "fully respect" the Palestinian move but stopped short of formal recognition of the state.

China, which has long supported the Palestinians' demand for a homeland, is also engaged in a quiet campaign to expand unofficial trade, cultural and military ties with Israel.

The PLO declaration was greeted with joy by many of the world's 5.5 million Palestinians, especially those living in refugee camps in Jordan and southern Lebanon. Some were wary of recognizing Israel, though.

In Ein el-Hilweh refugee camp in southern Lebanon, Palestinians marched through the streets in a rare nighttime demostration and celebration. They decorated the streets with Palestinian flags, small torches and signs.

A Lebanese police spokesman expressed fear that the declaration of the independent Palestinian state would lead to "clashes among the rival factions in Lebanon."

Syria and Damascus-based Palestinian guerrilla factions have rejected the independent state.

In Moscow, Foreign Ministry spokesman Gennady Gerasimov welcomed the council's acceptance of U.N. Resolutions 242 and 338, which set conditions for a comprehensive Middle East peace settlement.

He said the Soviet Union regards the resolutions as "very good grounds for a Middle East settlement, along with the need for the recognition of the legitimate national rights of the Arab people of Palestine to self-determination." Israel has refused to recognize such Palestinian rights

Israel reopened the occupied West Bank Wednesday, but the Gaza Strip and major West Bank cities remained under curfew.

The top Turkish diplomat in Israel was summoned to the Foreign Ministry so Israel could express its "sorrow and disappointment" over Turkey's decision to recognize the proclaimed Palestinian state.

Charge d'Affaires Ekrem Guvenderan was told the Turkish move did not "serve peace and security in the region and might increase the legitimacy of international terrorist organizations," a spokesman said.

In Jerusalem's Old City, more than 20 prominent Palestinians gathered in the Al Aqsa mosque to hear the declaration of independence read aloud before they signed their names to it.

"Today we are no more stateless or Jordanians but proud Palestinians in a Palestinian state," said Palestinian journalist Hanna Seniora, one of the declaration's signers.