Some U.S. Aid To Palestinians Will Continue, Diplomat Says

Humanitarian Funds Won't Stop Despite Role of Hamas

JERUSALEM, Feb. 25 -- A senior U.S. diplomat told Palestinian leader Mahmoud Abbas on Saturday that the Bush administration would provide humanitarian assistance to the Palestinians even after the radical Islamic group Hamas forms a cabinet in the coming weeks.

"We continue to be devoted to the humanitarian needs of the Palestinian people and we shall remain so," C. David Welch, assistant secretary of state for Near Eastern affairs, told reporters in the West Bank city of Ramallah.

But Palestinian officials who met with Welch, the most senior U.S. official to visit the West Bank since Hamas's victory in parliamentary elections last month, said the pledge did not guarantee the continuation of U.S. development funds. The United States provided more than $400 million in development aid to the Palestinian territories last year, all of it channeled through nongovernmental organizations and U.N. agencies rather than the governing Palestinian Authority.

Saeb Erekat, the chief Palestinian negotiator and a legislator from Abbas's defeated Fatah movement, said Welch did not define what he meant by humanitarian assistance nor specify what funding would be maintained.

"They can continue doing this in exactly the same way," Erekat said. "But we did not get a commitment from them to do so. We urged them to continue sending money through these same channels for projects like schools, water infrastructure and other projects. Otherwise there will be a huge backlash."

Since the victory by Hamas, formally known as the Islamic Resistance Movement, the Bush administration has been leading an international effort to isolate the Palestinian Authority once Hamas installs its cabinet. Hamas is designated a terrorist organization by the United States and the European Union and has refused to recognize Israel or renounce its armed campaign.

But disagreements have arisen between the Bush administration and some of its Arab allies and diplomatic partners over how best to persuade Hamas to recognize Israel and abide by previously signed agreements as its nominee for prime minister, Ismail Haniyeh, assembles his cabinet. Whether Hamas would respond to economic isolation by softening its position or turn to Israel's enemies for financial aid remains a central point of debate.

The quartet, a group of peace interlocutors made up of the United States, Russia, the European Union and the United Nations, has supported continuing funding for the Palestinian government until Hamas forms its cabinet. Israel recently froze the monthly transfer of tax and customs revenue it collects on behalf of the Palestinian government. At the same time, the Israeli government, which under international law is responsible for social conditions in the occupied territories, said it also intended to continue humanitarian assistance.

President Bush, meanwhile, has demanded the return of $50 million in U.S. aid to the Palestinian government, now managed by Abbas and a caretaker cabinet of his secular Fatah movement. Erekat said the money would be returned within two weeks.

"We believe that in this interim period it is very important to fund the Palestinian Authority," particularly Abbas, Secretary of State Condoleezza Rice told reporters following her trip this week to Egypt and Saudi Arabia, whose leaders refused to rule out funding a Palestinian government that included Hamas. "And we've been very clear that we intend to continue our humanitarian assistance in any case."

U.S. officials traveling with Rice said this week that they were exploring the possibility of redirecting the $50 million to projects that would directly aid Abbas's office.

The European Union, which gives roughly $300 million a year to the Palestinian Authority, is considering ways to channel the money to agencies managed by Abbas, who has urged Hamas legislators to pursue peace with Israel. Haniyeh and other Hamas leaders say they would consider a long-term truce with Israel if it leaves all the land it occupied in the 1967 Middle East war.

Welch praised Abbas after his Saturday meeting, appearing to support an approach that would strengthen Abbas's position in the Palestinian government. "I told him of our support for him and his leadership at this critical time facing the Palestinian people," Welch said.

Staff writer Glenn Kessler in Washington contributed to this report.