AMMAN -- Itis not enough for GeorgeBush and Mikhail Gorbachev to consolidate de'tente between the Soviet Union and the United States. They need also to demonstrate a fresh concern for the welfare of the Middle East -- a concern that regrettably wasn't displayed in their Washington summit. They must not allow the Mideast to be marginalized. Continued conflict in our region threatens the existence of a rational global order.

The fair resolution of the Palestine issue should become a peace item on the international agenda. This issue must not be allowed to be usurped by a fixation -- especially in the West -- on revolution and terrorism.

Unfortunately, the Arab consensus continues to be thwarted by various forces. Moderate Arabs were dismayed by the recent U.S. veto in the U.N. Security Council over international supervision and the observation of the outrages committed in the name of security in the occupied territories.

It is important to emphasize the desirability of an international peace conference, with the participation of the superpowers and the sponsorship of the U.N. Security Council.

We can hardly afford to wait until the Arabs and Israelis make suitable compromises that would bring them to the negotiating table. They must be prodded to talk to each other. And they must be induced to reach out not only to each other but also collectively to grasp new opportunities for a lasting peace.

The fashioning of political rapprochement -- "peace" -- between Arabs and Israelis will surely translate into something they need just as badly: equitable economic development in the region, particularly in those countries that aren't blessed with rich natural resources such as oil. Israel has paid a heavy economic price to ensure its survival. The Arab-Israeli conflict has similarly imposed heavy demographic and economic burdens on Jordan.

After lowering the budget deficit from 30 percent to 11 percent of the GDP between 1985 and 1988, Israel's deficit rose last year to nearly 40 percent of GDP. The country's high defense expenditure demands that much-needed funds be diverted from domestic development, a situation also experienced by Jordan and other Arab states desirous of regional peace. For Jordan, a country of barely 3 million people, to be spending $600 million annually on defense -- or 16 percent of our GDP -- is simply untenable.

The Six-Day War of 1967 represented a loss of 40 percent of Jordan's GNP and the acquisition of more than 400,000 refugees on account of Israel's occupation of the West Bank. The sharp drop in assistance from oil-producing Arab countries from $1.2 billion in 1981 to less than $400 million today has pushed resource-poor Jordan deeply into debt. Contributing to our economic problems has been the world decline in commodity prices, although we have made every effort to streamline the phosphate industry, our biggest export trade item.

As the revenues of our oil-producing neighbors declined, remittances from expatriate Jordanians in the Gulf -- the primary source of private-sector foreign exchange -- have dropped more than 20 percent in the last three years to less than $800 million. Meanwhile, Jordan's total external debt has risen from $3.5 billion in 1984 to nearly $8 billion. We have labored mightily to comply with recovery guidelines established by the International Monetary Fund -- but there is a limit to how much pain and deprivation we can impose on our already burdened people.

The intifada, which started in December 1987 in the West Bank and Gaza, has resulted in Palestinians liquidating more than $250 million worth of Jordanian dinars held by them as cash reserves. Such liquidation has no doubt propped up the Israeli economy, but Jordan has suffered heavily as a result.

It may be useful for all parties in the region to be mindful of the dangers posed by an expanding fundamentalist movement that is rapidly winning converts among our restless and unemployed young. This movement, influential in Moslem societies from Southeast Asia westward through Afghanistan to Lebanon and Morocco, may yet touch the intifada.

Unless peace prevails, there will be a different kind of war, a war that knows no territorial or national boundaries. It will be a war not between nation-states but against the nation-state. The aim of this war would be to reduce national entities to their socio-ethnic components. Its only triumphant residue will be politico-religious fundamentalism -- Islamic, Christian and Jewish. The Gulf, Palestine and Lebanon are only the flash points. This war, if uncontained, could extend from Cairo to Islamabad and beyond. We would then witness the ethnic Lebanonization of our region.

The domino theory is alive and kicking in the Middle East. Except that this time the threat is from fundamentalist fanatics, and it will annihilate moderate and secular-minded societies.

Jordan believes that while the two superpowers must assume greater responsibility in expediting the peace process, there must be greater regional economic cooperation to provide political stability and enhance the peace constituency in the Arab world. Presidents Bush and Gorbachev can strengthen their reputations as peace-makers by renewing their commitment to ending the generations-old conflict in the Middle East.

Since the Israeli settlements in the occupied territories violate international law, the United States and Europe should predicate their subsidization of the immigration and resettlement of Soviet Jews on Israel's freezing all settlement activity in the occupied territories. They can do much to ameliorate this difficult situation by increasing annual quotas for Soviet Jews to settle in their own countries.

The only acceptable basis for a just and lasting settlement is a fair exchange of land for peace -- as embodied in U.N. Resolutions 242 and 338. These call for the withdrawal of foreign presences from the occupied territories and also offer implicit recognition of Israel's sovereign existence.

The writer is crown prince of the Hashemite Kingdom of Jordan.