MIDDLE EAST: Israel has authorised the release of €8.6 million in frozen Palestinian taxes in a bid to ease a humanitarian crisis ahead of Ehud Olmert's first trip to Washington as prime minister.
While both Israel and the United States are working to isolate Hamas Islamists controlling the Palestinian government, the Jewish state has been under pressure to help avert the collapse of the Palestinian Authority. Israeli political sources, however, made clear that none of the funds to be released would reach the authority.
Israel plans to use the money to buy medical supplies based on advice from a foreign auditor and transfer them to Gaza hospitals.
The €8.6 million to be freed up is part of €172 million in Palestinian tax and customs levies frozen by Israel to push Hamas to recognise the Jewish state, renounce violence and accept past peace accords.
Western donors have also cut aid and contacts to put pressure on Hamas, which is committed to the destruction of the Israeli state and has refused calls to disarm.
Palestinian Authority spokesman Ghazi Hamad criticised Israel's decision to transfer the funds, calling it "blackmail for political concessions".
The United States is keen to bolster the more moderate Palestinian president, Mahmoud Abbas, as a partner for eventual peace negotiations. Mr Olmert has indicated that unilateral separation moves would be carried out if talks remain on ice.
Mr Abbas is caught up in an increasingly violent power struggle with Hamas, which defeated his long-dominant Fatah movement in the election.
Skirmishes between his loyalists and a new Hamas-led security force have stirred fears of civil war.
Late on Sunday gunmen in the Gaza Strip fired at a car carrying two militants from al-Aqsa Martyrs Brigades, which is part of Fatah, killing one of them, Palestinian security sources said.
Mr Olmert cast doubt on Mr Abbas's ability to lead negotiations with Israel, saying the Palestinian leader was powerless to stop militants."I don't ignore him," Mr Olmert told Fox News television.
"I don't boycott him. I respect him. I will negotiate with him if he is able to exercise enough authority in order to change Hamas. I hope he will have the power to do it and I will try to help him to do it."
In another sign of Israel shifting its stance, Mr Olmert's two top deputies met Mr Abbas at an economic summit in Egypt, the highest-level official contact since Hamas won Palestinian elections in January.
Mr Abbas said at the summit he would try to co-opt Palestinian factions later this month to try to get them to agree on a "two state solution", which would recognise Israel.
In Washington, where he will meet President Bush today, Mr Olmert hopes to win approval for his plan to quit some parts of the occupied West Bank and annex others in the absence of peace talks with the Palestinians.
Mr Olmert championed Israel's withdrawal last year from the Gaza Strip, which had sweeping international support. But there is less certainty this will be the case with a "convergence plan" entailing the setting of Israel's border in land Palestinians want for their state.
Speaking in Egypt, Israeli vice- premier Shimon Peres said Israel was committed to the US-led "road map" to a negotiated, two-state peace accord.