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WASHINGTON - The United States lifted its crippling aid embargo on the Palestinian government today to bolster moderate President Mahmoud Abbas while isolating Hamas Islamists controlling the Gaza Strip.
The resumption of direct US assistance came on the eve of White House talks between President George W Bush and Israeli Prime Minister Ehud Olmert, who has said he will co-operate with Abbas' emergency Cabinet formed after Hamas' takeover of Gaza last week.
Amid an outpouring of international support, Abbas told Bush in a telephone call today that the time had arrived to restart serious peace talks with Israel, and the US leader promised his support.
Hours later, Secretary of State Condoleezza Rice announced that the United States would "resume full assistance to the Palestinian government and normal government-to-government contacts."
At a news conference, Rice said the United States would contribute US$40 million ($53.66 million) to help ease the suffering of Palestinians.
"We will not leave one and a half million Palestinians at the mercy of terrorist organisations," she said. The United States, Israel and EU regard Hamas as a terrorist organisation.
Rice insisted the United States would not abandon Palestinians living in Gaza, but stopped short of endorsing a move by Abbas' government to reassert control there.
"We're going to support the course that they (the Palestinian officials) develop and that they outline," she said, stressing that it is a "fast moving situation" and Palestinian leaders first must focus on forming a government and obtaining needed financial resources.
Abbas' Fatah party has been accused in the past of corruption. Rice said his new government must continue to implement reforms, but she was confident the new prime minister, Salam Fayyad, who has a reputation for integrity, would institute reliable controls and ensure the aid is used for the good of the Palestinian people.
The United States and the European Union froze direct aid to the Palestinian Authority in early 2006 after Hamas won a parliamentary election and refused demands to renounce violence and recognize Israel's right to exist.
Bush today lent crucial support to Abbas, who disbanded the Hamas-led unity government and created an emergency Cabinet dominated by his mainstream Fatah movement.
The effective split between the West Bank and Gaza is widely seen as a blow to Palestinian aspirations for an independent state encompassing both territories.
Washington wants to accelerate contacts between Olmert and Abbas while shunning Hamas economically and diplomatically in Gaza.
In his phone call with Bush, Abbas said he "wanted to resume the political process and open political channels," White House spokesman Tony Snow said, confirming an account from an Abbas aide. But he said no timetable for negotiations with Israel had been discussed.
Asked whether Bush told Abbas it was time to resume talks with Israel, Snow said: "President Abbas made it clear that it is, and the president said that we will support it."
Rice said the Middle East was confronted with a fundamental choice "between violent extremism on the one hand, and tolerance and responsibility on the other."
She added: "Now, responsible Palestinians are making their choice, and it is the duty of the international community to support those Palestinians who wish to build a better life and a future of peace."
Palestinian President Mahmoud Abbas's emergency cabinet vowed today to exert its authority over the Hamas-controlled Gaza Strip.
"The government will pursue its jurisdiction over all parts of the homeland, regardless of what happened in Gaza," Abbas's Information Minister Riyad al-Malki told reporters after the new government met in the West Bank town of Ramallah.
Abbas formed the new cabinet last week in the West Bank after the Hamas Islamist group's armed wing routed security forces dominated by his Fatah movement in Gaza.
It is unclear how much influence Abbas's government can have in Gaza, now a Hamas fiefdom. Gaza and the West Bank are separated by 30 miles of Israeli territory.
Abbas's forces are focused on trying to prevent any spillover of the fighting from Gaza to the West Bank, where Fatah holds sway under Israeli occupation and where Hamas has threatened reprisals.
"We still do not have a clear plan," Malki said.
Asked how he would enforce the law in violence-prone Gaza, Abbas's interior minister in charge of security, Abdel-Razzak Yahya, said: "I swear to God I do not know."
Ismail Haniyeh of Hamas has said he still considers a three-month-old unity coalition in which he is prime minister as the legitimate Palestinian government and accuses Abbas of participating in a US-led plot to overthrow him.
The Jewish state renewed full fuel supplies to Gaza after halting them a day earlier, but issued orders to block cargo shipments to the strip.
An Israeli defence official, Shlomo Dror, said Israel may airlift food if necessary to avert a humanitarian crisis for 1.5 million Palestinians living there. Key crossings between Israel and Gaza have remained largely shut for days.
Palestinians in Gaza responded to the threatened blockade by stocking up on extra food at the local grocer.
"We are neither Hamas or Fatah, so why should we be punished?," said Huda, 29, a mother of two, as she loaded up on extra milk.
Israeli Foreign Minister Tzipi Livni, who met European foreign ministers in Luxembourg to press them to keep isolating Hamas, said Israel should seize an opportunity offered by the political divisions between the West Bank and Gaza.
"We should take advantage of this split to the end," Livni said. "It differentiates between the moderates and the extremists."
Livni also said Abbas's "new government can send a message of hope" for the prospect of future peace talks.
Some European diplomats have expressed misgivings about the US-Israeli strategy and whether it could deliver a lasting solution. Others point to questions over the legal underpinnings of the cabinet Abbas set up by decree over Hamas's objections.
Iran, which supports Hamas, blamed the United States and other foreign parties for the crisis between Hamas and Fatah, an Iranian news agency reported. Iran's Foreign Minister Manouchehr Mottaki urged calm between Palestinian factions.
- REUTERS
