Palestinian Economy Is A Concern

Israeli and Palestinian officials, after agreeing last week to improve economic cooperation, will meet with international donors to discuss the Palestinian economy and reform efforts, officials said Monday.

European, U.S. and World Bank officials were scheduled to participate in Monday's meeting in Gaza City.

The gathering is a follow-up to last week's annual meeting in Rome of international donors to the Palestinian Authority. At that meeting, the donors, who provide some $1 billion to the Palestinians each year, warned Israel and the Palestinians that badly needed funds could be withheld if violence does not abate.

International aid is critical for both sides. The money covers about 60 percent of the annual Palestinian budget and is used for development projects, infrastructure and other needs of the poverty-stricken population.

Israel also has an interest in seeing the aid continue, since the funds allow Israel to avoid the cost of occupying lands where millions of Palestinians live.

The donors urged the Palestinians to crack down on violence and to continue with economic reforms, while calling on Israeli to ease living conditions for the Palestinians.

Meanwhile, Palestinian sources told the Israeli newspaper Haaretz that Egyptian mediators plan to start a new round of talks Tuesday between the various Palestinian factions. Hamas would be one of the participants, the sources said.

At the Rome meeting, Israeli and Palestinian officials agreed to form a three-way body — along with donors — to better distribute aid.

In fresh violence Monday, Israeli troops shot and killed two unarmed Palestinians when they tried to infiltrate Israel from the Gaza Strip.

Four others managed to enter Israel, the army said. One was caught in the early morning, and was also unarmed. Three others remained at large, and soldiers set up impromptu checkpoints and roadblocks as forces hunted them down.

The six Palestinians had entered an area that was clearly off-limits, the army said. It was possible they wanted to enter Israel to work, the army said. However, the army said it had not ruled out the possibility the six were planning attacks in Israel.

Earlier, officials said that a three-way Israeli-U.S.-Palestinian meeting Monday was to focus on reviving the U.S.-backed "road map" peace plan.

The sides have been trying to arrange a summit between Israeli Prime Minister Ariel Sharon and his Palestinian counterpart Ahmed Qureia, but have not been able to set a date.

Qureia has been trying to persuade Palestinian militant factions to commit to a cease-fire with Israel as a first step toward resuming peace talks, and he hinted Monday at a possible breakthrough soon, saying "God willing, we will have a new important development in coming days."

An Egyptian delegation led by Maj. Gen. Mohsen Noamaini, the deputy director of intelligence, was expected in Gaza on Tuesday to meet with the various Palestinian factions, an Egyptian diplomatic source said. The Egyptians have served as mediators in cease-fire talks over the past few weeks.

Meanwhile, in the West Bank, Israeli police and soldiers scuffled with a few teenage Jewish settlers while dismantling an unauthorized outpost near the Palestinian city of Nablus, police spokesman Gil Kleiman said, adding that three minors were detained.

Israel has yet to fulfill its obligation to dismantle the outposts under the "road map," which also calls for a freeze on construction at established Jewish settlements in the West Bank and Gaza Strip.

The Palestinians also have not moved forward on dismantling militant groups as required by the plan, which seeks an independent Palestinian state by 2005.

On Monday, however, U.S. and Palestinian officials said the talks would focus on economic issues, not the peace plan.

"They're going to discuss cooperation and how to advance it. This is mostly cooperation in the area of Palestinian reform and economic development," U.S. Embassy spokesman Paul Patin said.

"The focus of the meeting is donor-related issues and especially ... the financial and economic situation in the Palestinian Authority," senior Palestinian negotiator Saeb Erekat said.

The Palestinian Authority has been especially hard hit by three years of fighting. Israeli blockades and closures on Palestinian towns and villages, debilitating travel restrictions and a ban on most Palestinian laborers from entering Israel have ravaged the fledgling Palestinian economy.

Israel has also been hurt by the fighting, with the economy weakened by less tourism and the global slowdown.

Also in Gaza on Monday, Israeli forces backed by about two dozen tanks raided the Khan Younis refugee camp near a Jewish settlement bloc. Over the weekend, Palestinian militants fired a barrage of 21 mortar shells at the Gush Katif settlement block, causing minor damage.

Palestinian residents of the camp said the army demolished eight buildings — three of them abandoned, and five of them houses that people don't sleep in at night due to frequent firefights in the area.

The military said the goal of the operation was to destroy a building used by militants for firing mortars.

Also Monday, a court held a preliminary hearing for 23-year-old Jamal Akkal, a Gaza-born Canadian citizen charged with conspiracy to commit murder for allegedly planning to carry out attacks against Israeli officials traveling in the United States and bombings against North American Jewish interests.

Akkal denied the charges at his first appearance before the court at an Israeli military base on the border with Gaza. He had signed a confession but his lawyers say it was signed under duress.

According to the indictment, Akkal was to buy an M-16 assault rifle in Detroit and bomb materials for the attacks, which were not carried out. He was arrested in Gaza on Nov. 1.