Thousands of tourists descend on Bethlehem as birthplace of Jesus celebrates its merriest Christmas in years Last updated at 9:16 AM on 25th December 2010 The traditional birthplace of Jesus celebrated its merriest Christmas in years as tens of thousands of tourists descended on Bethlehem. Officials said the turnout was shaping up to be the largest since 2000. Unseasonably mild weather, a virtual halt in Israeli-Palestinian violence and a burgeoning economic revival in the West Bank all added to the cheer. By nightfall a packed Manger Square was awash in red, blue, green and yellow Christmas lights. Merrymakers blasted horns, bands sang traditional Christmas carols in Arabic, Boy Scout marching bands performed and Palestinian policemen deployed around the town to keep the peace. Latin Patriarch of Jerusalem Fouad Twal carries the statuette of baby Jesus during the midnight Mass ceremony which marks the beginning of Christmas Day at the Church of the Nativity in Bethlehem A nun takes communion from Latin Patriarch of Jerusalem Fuad Twal during the midnight mass ceremony which marks the beginning of Christmas Day A group of 30 tourists from Papua New Guinea wearing red Santa hats walked around the nearby Church of the Nativity, built on the site where tradition holds Jesus was born. Both church officials and the Palestinian president voiced hopes for peace. Bethlehem used to attract tens of thousands of tourists from around the world for Christmas celebrations, but attendance dropped sharply following the outbreak of the second Palestinian uprising in 2000. As the fighting tapered off over the last five years, attendance steadily climbed. The town's 2,750 hotel rooms were booked solid for Christmas week, and town chiefs say more hotels are being built. Israeli officials said they expected about 90,000 visitors in Bethlehem during the current two-week holiday season, up from 70,000 last year. But the bloodshed has left its mark. Visitors entering the town must cross through a massive metal gate in the separation barrier Israel built between Jerusalem and Bethlehem during a wave of Palestinian attacks last decade. Christian pilgrims pray in the Church of the Nativity, the site revered as the birthplace of Jesus, in Bethlehem A Christian pilgrim arrives at the Church of the Nativity last night The Roman Catholic Church's top clergyman in the Holy Land, Latin Patriarch Fouad Twal, crossed through the gate in a traditional midday procession from Jerusalem. Later he celebrated Midnight Mass, the peak of the Christmas events. In his homily, he issued a conciliatory call for peace between religions and urged an 'intensification' of dialogue with Jews and Muslims. 'We need to unite and integrate the many values we have in common: prayer, piety, fasting, almsgiving, and ethical values,' he said. 'Our hope for Christmas is that Jerusalem not only become the capital of two nations, but also a model for the world, of harmony and coexistence of the three monotheistic religions. 'During this Christmas season, may the sound of the bells of our churches drown the noise of weapons in our wounded Middle East, calling all men to peace and the joy.' The crowds continued to swell throughout the day and by last night, Israeli military officials, who co-ordinate movement in and out of the West Bank, said the number rose to around 70,000 people, compared with 50,000 last year. Raed Arafat, the 40-year-old owner of the Stars and Bucks Cafe, played Christmas songs over loudspeakers and handed out free Arabic coffee at his shop near Manger Square. Tourists took photos and bought mugs emblazoned with the cafe chain's green logo, modelled after the American Starbucks company. A Palestinian policeman stands guard at a roof watching the celebrations at the square of the Church of the Nativity, where Christians believe the Virgin Mary gave birth to Jesus Christ Palestinian president Mahmud Abbas (L) attends the midnight mass ceremony which marks the beginning of Christmas Day The holiday had its surreal moments. Many visitors were local Palestinians, including a large number of Muslim women whose faces were covered by veils. The loud Muslim call to prayer from a mosque next to Manger Square briefly drowned out the celebrations. 'Because of the hard situation and the pressure we are living in, we take advantage of any joyful moment and bring our children to play,' said Khitam Harazallah, a housewife from the nearby Deheishe refugee camp who came with her two young children. Today, just one-third of Bethlehem's 50,000 residents are Christian, down from about 75% in the 1950s. The rest are Muslims. The Christian population throughout the Middle East has shrunk in recent decades as people flee violence or search for better opportunities abroad. Christians make up roughly 2% of the population in the Holy Land. With the end of fighting, the West Bank has undergone an economic revival in recent years, illustrated by new shopping malls and widespread construction projects in the bustling city of Ramallah. A priest blesses the statue of the baby Jesus inside in the grotto which marks the spot where Christians believe Christ was born But a deadlock in Middle East peace talks between Israel and the West Bank government of Palestinian president Mahmoud Abbas, along with a flare-up in violence between Israel and militants in the Gaza Strip, threatened to cast a pall over the celebrations. Mr Abbas, a Muslim, travelled to Bethlehem to greet revellers, saying he hoped the coming year would finally bring peace. 'We are seekers of peace in the path of Jesus,' he said. 'We hope that next year will be a year of peace by establishing the independent Palestinian state with Jerusalem as its capital, living side by side with Israel in peace and security.' Israel maintains an embargo on Gaza, which is governed by Mr Abbas' rival, the Islamic militant group Hamas. In a goodwill gesture, Israel allowed 500 members of Gaza's tiny Christian community to travel to Bethlehem. Niveen Wadia, a 40-year-old Gaza woman, said coming to Bethlehem was 'a very beautiful feeling.' 'In Gaza we don't have any celebration atmosphere. We are the minority there,' she said.