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This Christmas morning, despite an icy rain, thousands of Christians crowded into churches in the West Bank town of Bethlehem. At the Church of the Nativity built above the grotto where many Christians believe Jesus was born, there were calls for peace. NPR's Linda Gradstein was in Bethlehem and filed this report.

Unidentified Man: (Chanting in foreign language)

LINDA GRADSTEIN reporting:

The midnight Mass in the Church of the Nativity. Despite icy pelting rain, thousands of pilgrims came to pray. Palestinian leader Mahmoud Abbas was also there, the first Palestinian leader to attend the service in five years. Israel had prevented Abbas' predecessor, Yasser Arafat, from attending for several years.

The Latin patriarch, Michel Sabbah, urged political leaders to move toward peace. `God created you not to fear or to kill each other but to love each other, to build and to cooperate together,' he said in a message addressed to Israelis and Palestinians. He said there seems to be a new reality despite the many complications and hesitations that surround it. Israeli Prime Minister Ariel Sharon called local Christian leaders yesterday to wish them a merry Christmas and said he hopes the new year will bring Israel and the Palestinians peace and security.

The streets of Bethlehem were decorated with more lights than in the past few years and Israeli officials said almost 30,000 visitors had crossed the Israeli checkpoint into Bethlehem, many more than in the past few years. But the inclement weather kept many inside their hotels. On Manger Square, Victor Tabash, the owner of the souvenir shop opened by his father in 1927, said business was far worse than he had expected.

Mr. VICTOR TABASH: Even during the problems, during the war and during everything, I have never seen like no people; not--nothing at all and nothing (unintelligible). I wonder what is this? Something unusual.

GRADSTEIN: A steady stream of family and friends came into his shop to wish him a merry Christmas. His six-month-old granddaughter, Rita, was dressed in a red velvet outfit and gazed in wonder at a large Santa Claus balloon.

(Soundbite of people talking)

GRADSTEIN: One of the few customers was Pearl Hmong(ph), a pilgrim from Hong Kong visiting Israel and Bethlehem for the first time. She said the trip had more than fulfilled her expectations.

Ms. PEARL HMONG (Pilgrim): I like it. I like Israel. I like the land, the church, the buildings, everything, including all the ruins, archaeology, a lot of things, a lot of history and culture, a very impressive land.

GRADSTEIN: Many Palestinians here remember the peak years of the 1990s, when the streets were jammed with tourists. Last night close to midnight, Joseph Zana(ph) walked quickly through the rainy streets on his way to the Greek Catholic Church. Zana was born in Bethlehem and is raising his four children here. He said Palestinians must continue to have faith in the future.

Mr. JOSEPH ZANA: You have to pray now. I have to pray for peace, for all nations and still for my kids.

GRADSTEIN: Linda Gradstein, NPR News.

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