Israel has brushed aside US loan cuts imposed over its building of a controversial barrier and expansion of settlements on occupied.
Israeli Deputy Prime Minister Ehud Olmert shrugged off the US decision to cut nearly $290 million in a multi-billion package of loan guarantees.
"The fact is they aren't putting any political pressure on us to do anything on the substantive issues of the political process," he told Israeli Army Radio yesterday.
Part of the cuts corresponds to the costs of Israel's building a West Bank barrier, singled out by US President George W. Bush as unhelpful to peace negotiations.
Palestinians said the funding cut would not make Israel change its plans. "I'm afraid that this step as a message will not deter Israel from continuing to build the wall and the settlements," said the Palestinian Negotiations Minister Saeb Erekat.
Israel claims it needs a barrier of concrete, razor wire, ditches and electric fences to stop suicide attacks that have killed over 450 people in three years. Palestinians call it a bid to annex land taken in the 1967 Middle East war and say the Israelis must stop construction if they are serious about the road map.