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Rice stands firm against Hamas

Vows no US aid for Palestinian Authority led by Islamic group

LONDON -- The United States will provide no funds to a Palestinian government formed by the Islamic group Hamas, and expects the same from other countries and international institutions, Secretary of State Condoleezza Rice said yesterday.

Rice's declaration of what she called a ''bedrock principle" raises the possibility that a Hamas-led Palestinian Authority will not be able to pay its officials and police officers.

The United States contributed $70 million to the Palestinians last year; the European Union contributed $612 million.

Rice made her comments yesterday as she flew to London from Washington for talks today with officials from the EU, Russia, and the United Nations on Middle East issues after Hamas's startling landslide victory in Palestinian parliamentary elections last week.

Rice said the Bush administration would continue providing humanitarian aid ''on a case-by-case" basis to projects that help the desperately poor majority of the 3 million Palestinians living in the West Bank and Gaza.

But a Palestinian government formed by Hamas will not receive US funds, she said. ''Hamas doesn't recognize Israel, advocates violence, and refuses to be a responsible party to the peace process," she said, noting that the United States, the EU, and the UN list the organization as a terrorist group.

''The bedrock principle here is that we cannot have funding for an organization that holds those views just because it is in government," she said.

The top US diplomat indicated that she would press for similar commitments in her talks with officials from nations that, along with the United States, form the so-called Quartet directing Israeli-Palestinian peace talks: EU foreign policy chief Javier Solana, Foreign Minister Sergei Lavrov of Russia, and UN Secretary General Kofi Annan.

''We are talking about assistance from the international financial institutions, we are talking about United Nations assistance, we are talking about European assistance, we're talking about Asian assistance, we're talking about considerable assistance from the region, and we are talking about American assistance," she said.

''The implications of supporting a peace process on the one hand, in which we are all part of the Quartet, and on the other hand supporting the activities of a partner in that set of negotiations that doesn't even recognize the existence of the other partner, it just doesn't work," Rice said.

In Jerusalem yesterday, Chancellor Angela Merkel of Germany issued the most explicit threat to cut aid from Europe, saying the EU could not fund a Hamas-run Palestinian Authority if it did not renounce violence and recognize Israel, Reuters reported.

''Such a Palestinian Authority cannot be directly supported by money from the EU," said Merkel, standing beside interim Prime Minister Ehud Olmert of Israel at the start of her visit to the Mideast.

The Bush administration sees international funding as a key source of leverage to persuade Hamas to abandon its hard-line positions, something its leaders have refused to do since last Wednesday's elections. But it was unclear how successful Rice would be in persuading the other Quartet members, as well as Arab and other Muslim governments, to embrace the Bush position.

The Quartet members demanded that Hamas renounce violence, recognize Israel, and disband its armed wing after the elections in which the group won 74 out of 132 seats, ending decades of dominance of Palestinian politics by Fatah, the faction founded by the late Yasser Arafat.

Hamas has rejected those demands.

Others have questioned the wisdom of withholding funds, suggesting that a cutoff would allow Iran to expand its influence by making up for the losses.

The Palestinian Authority, which oversees the West Bank and Gaza Strip, is essentially bankrupt, with a deficit of more than $60 million in its annual budget of $1.3 billion.

Last year, the United States provided $225 million in humanitarian assistance through the US Agency for International Development and $88 million to UN assistance programs for the Palestinians.

Rice also said she had ordered a review into why the State Department had failed to predict the Hamas victory.

''I don't know anyone who wasn't caught off guard by Hamas's strong showing," she said. ''Some say that Hamas itself was caught off guard."

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