MIDDLE EASTThe Revolutionary Justice Organization yesterday said it would release American hostage Joseph James Cicippio within 48 hours, and a pro-Israeli militia set free 25 Arab prisoners as part of an apparent exchange. Hours after the RJO announcement, the South Lebanon Army released 25 of the estimated 350 Arabs held by Israel.... Fearing an Arab "peace victory" in Middle East talks scheduled to resume Wednesday in Washington, Israel's Cabinet was slated to meet yesterday to reconsider delaying participation in the summit. President Bush made clear over the weekend there would be no US compromise over the starting date. Meanwhile, Palestinian leader Yasser Arafat met yesterday with Egyptian President Hosni Mubarak prior to the Washington talks (see stories, Pages 1 and 7). UNITED STATES Former Ku Klux Klan leader David Duke will announce today that he will challenge George Bush for the Republican presidential nomination in 1992, according to a Duke aide. Duke lost his bid to become governor of Louisiana last month.... The Christmas shopping season began over the weekend with buyers in a cautious mood and economists watching to see if consumers will boost the weak US economy. Holiday purchases are a crucial indicator of consumer confidence. Meanwhile, President Bush's public-approval rat ings fell below 50 percent for the first time, according to a Time-CNN poll. The survey also reported Bush's handling of the economy was rated as "poor" by 74 percent of the 500 adults polled. AFRICA In Nairobi, President Daniel arap Moi's ruling party was to meet today amid mounting demands for political reform. Moi says a multiparty system does not suit Kenya at present.... In Lome, Togo, fears of a coup against Prime Minister Joseph Kokou Koffigoh eased yesterday when rebel troops withdrew from positions around his official residence. The Army, which took over many of President Gnassingbe Eyadema's powers last week, kept its grip on the national radio.... Red Cross workers in Mogadishu were trying to reach hundreds of civilians wounded in factional fighting in the Somali capital. Fighting continued yesterday between supporters of interim Somali President Ali Mahdi Mohamed and Gen. Mohamed Farah Aideed, chairman of the United Somali Congress. EUROPE AND SOVIET UNION Ukrainians voted yesterday in an independence referendum. The expected support for independence in the economically vital republic of 52 million people seemed to dash hopes of salvaging a new confederation of Soviet republics.... Heavy fighting broke out in Croatia hours before the arrival of UN peace envoy Cyrus Vance. He was due to arrive yesterday to discuss the size and role of a possible peacekeeping operation.