"It is unrealistic to further put off the creation of a Palestinian state," Arafat told reporters at his headquarters in Ram Allah on Saturday.
"One ought already to have been proclaimed in 1998-99" under the terms of peace agreements already signed with Israel, he said.
Arafat was reacting to comments by Bush in an interview with leading Egyptian daily al-Ahram on Saturday, which were swiftly seized upon by a gleeful Israel.
"Well, 2005 may be hard, since 2005 is right around the corner," the US president said in reference to the target date laid down in the internationally drafted Middle East peace "roadmap".
"I think the timetable of 2005 isn't as realistic as it was two
However, the American president said United States was committed to the "road map" and he would make this clear in a letter to Palestinian Prime Minister Ahmad Quraya, who replaced Abbas late last year.
The road map
The "road map" charts reciprocal steps towards the establishment of a viable Palestinian state in the West Bank and Gaza Strip in 2005, including demands that the Palestinians should halt resistance and Israel freeze settlement construction.
But the peace plan ground into deadlock shortly after it was
"Well, 2005 may be hard, since 2005 is right around the corner"
adopted last year due to continuing violence and mainly Israeli non-compliance.
A close aide of Israeli Prime Minister Ariel Sharon welcomed Bush's comments, but went further, ruling out any possibility of Palestinian statehood next year.
"The target date of 2005 has become an impossibility because we are still at the starting point of the roadmap as a result of the Palestinian Authority's refusal to combat terrorism," said foreign policy adviser Salman Shoval.
"Under these conditions, it's clear that the 2005 target date is no longer at all realistic."