CAIRO, Egypt (AP) _ On his first visit to an Arab country as Israel's prime minister, Benjamin Netanyahu brought words of peace Thursday to a region shaken by his election victory two months ago.

While the Israeli leader took no major steps to push forward the stalled Middle East peace process, he went out of his way to praise his Egyptian hosts, particularly President Hosni Mubarak, and took pains to at least speak the language of peace.

``We agreed that we must intensify our efforts to expand the circle of peace, which of course is important for both Israel and Egypt and the entire region,'' Netanyahu said after a two-hour meeting with Mubarak. ``We believe that the peace should be based on the idea of fulfilling existing commitments.''

He hailed Egypt as ``the pivot of peace'' and said he felt ``renewed confidence'' that peace could be achieved.

Netanyahu arrived Thursday a wildly unpopular figure, facing deep anger over what many Arabs consider a betrayal of years of difficult negotiations. All week, Egyptian newspapers published bitter attacks, unprecedented before the visit of a foreign leader.

``No to the Rotten Smell in the Land of Egypt,'' read the headline of the opposition newspaper El-Ahrar on Thursday.

It was an oft-repeated play on Netanyahu's name _ in Arabic, ``neten'' means ``rotten smell.''

Netanyahu's positive remarks were not likely to assuage Arab fears.

Of particular concern to Arab countries has been his stated opposition to trading land _ won in the 1967 Mideast war _ for peace. That formula has been the basis of talks that began in Madrid, Spain, in 1991.

Netanyahu said there were ``different interpretations'' of that formula and again stressed that Israel's security was the most important issue in any peace agreement.

Mubarak insisted that peace should be based on U.N. resolutions urging the return of captured land. He said there could be ``different thoughts,'' but not different interpretations, on the agreed basis for negotiations.

Netanyahu said he was ready to renew talks with Syria ``right away'' _ a position he has stated before. But he gave no timetable on a withdrawal from Hebron, the last West Bank city under occupation.

In an attempt to end Palestinian bitterness over his refusal to meet Yasser Arafat, Netanyahu said Israeli Foreign Minister David Levy would meet the Palestinian leader next week.

Netanyahu also said he would allow 10,000 more Palestinian workers to enter Israel. Those workers were barred under a nearly five-month closure of the West Bank and Gaza Strip that followed a series of deadly suicide bombings by Muslim militants.

``Our intention is to make life easier and to make an ... open relationship rather than a closed one,'' Netanyahu said. ``And this will accompany our talks with the view of creating good will.''

Egyptian Foreign Minister Amr Moussa, who has sharply criticized Israel, called the talks ``a step forward.''

``Now we know the situation a little better,'' he said.

Netanyahu said on his return to Israel: ``I think that before the visit there was a cloud, for all kinds of reasons, and I think it has disappeared.''

Egypt, the first Arab country to sign a treaty with Israel in 1979, has led the campaign to slow normalization since Netanyahu's election in May. With the backing of Syria and Saudi Arabia, it convened the first Arab summit in six years last month and has orchestrated a flurry of meetings among Arab leaders in recent weeks.

Netanyahu visited Egypt's tomb for its unknown victims of war and the grave of President Anwar Sadat, who was killed by Muslim militants after making peace with Israel. He also took a helicopter ride over Cairo before departing.

There were the usual misunderstandings during his visit.

A translator on Egyptian television referred to Netanyahu as ``Prime Minister Shamir,'' the former right-wing Israeli leader.

Netanyahu, for his part, referred to the West Bank by its biblical names, Judea and Samaria, suggesting a Jewish claim.

At an otherwise cordial news conference, Mubarak and Netanyahu clashed when the Israeli prime minister said he appreciated Mubarak's opposition to dividing Jerusalem.

Mubarak interrupted.

``I did not say to have a wall separating the city,'' he said, ``but I think that a formula can be arrived at.''

Jerusalem is the toughest issue in Arab-Israeli negotiations. Israel claims the entire city as its capital; the Palestinians want shared sovereignty with east Jerusalem as their capital. Netanyahu has said he will not negotiate over the city's future.