BRUSSELS, Oct. 26 (JTA) – The faltering Israeli-Palestinian peace process has apparently led to the abrupt cancellation of an economic conference by a country that has long been regarded as a friend of the Jewish state. Moroccan officials canceled this week a meeting between ministers of the European Union and 12 Mediterranean countries. According to well-informed sources, the move came in order to avoid the participation of an Israeli delegation. “Israel’s participation would put Morocco in a difficult position within the Arab world,” a Moroccan government source was quoted as saying. The meeting, scheduled to take place Thursday and Friday in Marrakech, was expected to discuss industrial cooperation between the Mediterranean countries and the 15 E.U. member states. The decision to cancel the meeting was made in a communique issued by the Moroccan Trade and Industry Ministry. No official reason was given. The meeting was to be a follow-up to a conference held November 1995 in Barcelona that launched the so-called Euro-Med partnership aimed at creating a free-trade area by the year 2010 and a program of European investment in the participating Mediterranean countries. The partnership was a result of the progress in the peace process. The recent stalemate between the Israelis and the Palestinians has clouded prospects for another economic conference involving Middle East and North African states that is scheduled to be held in November in the Persian Gulf state of Qatar.