Syria, Libya and the Palestine Liberation Organization tonight walked out of an Arab conference considering sanctions against Egypt, charging that the proposed measures did not go far enough and did not strike at the United States for sponsoring the Egyptian-Israeli peace treaty.
PLO leader Yasser Arafat said through a spokeman that it was time for "harsh punishment" of Egyptian President Anwar Sadat for signing the treaty with Israel and of the United states for its role as "engineer" of the historic agreement.
He called for a cutoff of all Arab rconomic and technical aid to egypt, a proposal that had the support of several hard-line states but not of the Arab moderates led by Saudi Arabia, and for and oil embargo against the United States.
Arafat announced the PLO's withdrawal from the meeting when it became apparent that the foreign and economic ministers of 19 Arab countries meeting here were not prepared to go that far, and the Syrian and Libyran delegates followed him out in apparent support of his complaint.
Just as Egypt expected when it signed the treaty, the walkout showed a clear gap between the rhetoric of criticism aimed at Sadat and the actual measures Arabs are prepared to take. But the conference did not break up and the three delegations are expected to return if some facesaving formula can be developed.
The meeting continued until after midnight and is to resume on Thursday as the delegates look for some way to restore the image of Arab unanimity and collective action that they have been aiming for.
Since the press is totally isolated from the Palace of Peace, where the meeting is taking place, it was difficult to determine what proposed compromises were under study. But there were reports that the Saudis has suggested a formula by which all participants would agree on limited sanctions already approved and endorse any individual country's rihght to take further measures.
Earlier, Iraqi Foreign Minister Saadoun Hamadi announced that the delegates had agreed to call a new Arab summit meeting at an unspecified date to consider sanctions beyond those approved at a summit conference here in November.
That in itself indicated that this meeting would end with less than the clear-cut action against Egypt that Sadat's most determined foes were seeking. The walkout, whether a theatrical maneuver or a genuine split, will only confirm Egypt's belief that it faces little actual damage from the combined action of the other Arabs so long as the Saudis hold out against the extremists.
As if to dramatize how differently the Arabs have reacted to Sadat's policies, Jordan announced today that it was withdrawing its ambassador from Cairo while the ruler of Oman, Sultan Qaboos, gave his endorsement to the peace treaty, at the same time emphasizing that it could only be first step toward a broader accord.
The Kuwaiti newspaper Ai Watan reported that Syrian Foreign Minister Abdul Halim Khaddam said in an interview that Arab states will work to overthrow Qaboos for failing to support action against Egypt. Khaddam said Sudan also will be a target for Arab action, the paper reported, although there has been no announcement from Khartoum of Sudan's position on the treaty.
Sudanese President Jaafar Nimeri is known, however, as a close ally of Sadat and has supported him in earlier stages of the Egyptian peace talks with Israel.
Arafat's spokesman, Azzam Ahmed, said the Palestinain delegation saw that he conference resolutions "were not sufficient for the size of the plot against the Palestinian cause. There is somebody who wants to ignore the big role played by the United States in the signing of the treaty and providing guarantees for its success."
Arab journalists present during the walkout as members of various delegations said it was clear this referred to the Saudis. They were expected from the beginning of the conference to refuse to halt their payments for Egyptian arms purchases from the United States and were considered unlikely to endorese any call for an oil embargo that would cause chaos in the West.
The PLO statement said that while a proper first step in punishing Sadat had been taken at the summit conference here in November, the task of the current meeting should be to "look for the steps to be taken against the engineer of the plot, the U.S."
The gesture of freezing Egyptian membership in the Arab League was preempted by Sadat's move yesterday to do it himself, and the statement said it was now necessary to call for more substantive measures. The conference was not doing so, it said.
According to the Palestinian statement, Arafat appealed to the delegates not to "transform the Palestinian people into murderers and gangsters" by leaving them to face the "plot" unaided. He said increased guerrilla activity inside Israel and the Israeli-occupied territories would show Palestinian determination to reject the treaty formula for Palestinian autonomy, but "this meeting will disautonomy, but "this meeting will disappoint the hopes of the Arab nation" if it fails to support that struggle with tough measuress against egypt and the United States.
The walkout of the three delegations followed a day of maneuvering in which all 19 delegations reportedly agreed on implementing relatively mild sanctions against Egypt adopted at the November summit here, but split over whether to go beyond them and include the United States as a target.
The sanctions approved in November included transfer of Arab League headquarters out of Cairo, suspension of Egyptian membership in the League and an economic and trade boycott against Egyptian companies or individual doing business with Israel.
According to Arab newspaper accounts verified by Iraqi officials, they did not include cutting off economic or military assistance to Egypt and they specifically rejected any action that could be interpreted as harmful to Egyptian people as individuals, such as expulsion of the million or more Egyptians working in other Arab countries.
The Iraq News Agency quoted conference participants saying there was unanimous agreement on those sanctions, all of which the Egyptians can easily live with. The split developed when Iraq, the PLO, Syria and Libya sought to go beyond them and the walkout occurred when they apparently were dissatisifed with the decision to call a new meeting to consider proposed additional measures.
It was widely viewed as a tactical maneuver rather than a real split but was hardly the stirring testimonial to Arab unity that participants have been calling for.
Iraw and Syria were asking for a halt to all economic and technical assistance to Egypt, withdrawal of all official and personal accounts from Egyptain banks and a political campaign to stir up opposition to the treaty among the Egyptian people, The PLO wanted to go even beyong that and try to punish the United States as well,
Hamadi, the Iraqi foreign minister and conference chairman, appointed a commitee to draft one compromise paper. The members were Iraq, Syria, Libya, the PLO, Kuwait and Saudi Arabia. That meant that the PLO's call for an oil mebargo against the United States was doomed.
Arafat must have suspected when he first proposed it yesterday that this move had no chance of gaining Saudi support, but Arab observers here said he had nothing to lose by putting it forward since it would at best win a tougher line from the conference and at worst show the POL's dedication and willingness to take risks to prod the other Arabs into action.