Historic U.S. city set to make Mideast history

By Deborah Charles

ANNAPOLIS, Maryland (Reuters) - A picturesque waterfront city, once the capital of the United States, has a chance of making Middle East history this month when Israelis and Palestinians meet to talk peace.

"We wonder 'Why here?'" said a Main Street shop employee in Annapolis, a city of 36,000 people best known as home to the 162-year-old U.S. Naval Academy. "I think it's security -- they can lock the gates at the academy."

All over town, people said they were bracing for the tight security likely to accompany Israeli Prime Minister Ehud Olmert and Palestinian President Mahmoud Abbas at the U.S.-brokered meeting in the city.

"It's going to close everything up," said the employee of the upscale boutique, who asked not to be identified, as she contemplated the potential damage to the start of the Christmas shopping season. "This is our best season of the year and they're going to take it away from us."

"Parking is always hard and it will get even worse," said a woman who wanted to be identified only as Patty. As she stood in her antiques and housewares shop on brick-lined Main Street, she said business already seemed unusually slow this year in the historic tourist city and Maryland state capital.

While not as remote as the Camp David presidential retreat -- site to past Middle East peace talks -- the Naval Academy offers a secure environment that is only a few blocks away from downtown shops and restaurants.

CAPITAL CITY

The narrow streets in downtown Annapolis were built in the 17th and 18th centuries, hardly ideal for heavy traffic. Ben Crane, a clerk at a historic inn across the street from the State House, wondered if the influx of people and heightened security would cause even more congestion.