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EU threatens to cut financial aid to Palestinians

Says Hamas must pursue peace

SALZBURG, Austria -- The European Union yesterday threatened to cut off aid to a Hamas-led Palestinian government ''unless it seeks peace by peaceful means" -- its strongest signal yet to the new leadership.

The EU foreign ministers reviewed financial aid to Palestinians but announced no immediate halt to funds as long as Hamas has not formed a government, which it is expected to do later this month.

''We want to remain a reliable partner for the Palestinian people, but we will not go soft on our principles," EU External Relations Commissioner Benita Ferrero-Waldner said at the outset of two days of informal talks by EU foreign ministers in Salzburg. ''Money will not flow to the new [Palestinian] authority unless it seeks peace by peaceful means."

German Foreign Minister Frank-Walter Steinmeier said the EU wants to see the Hamas-led government's platform to find out what it thinks of the ''road map" to Middle East peace drafted by the United States, the EU, Russia, and the United Nations.

The EU expects a Hamas-led government to recognize Israel, renounce violence, and accept all previous agreements between the Palestinians and Israel.

If it does not do that, ''there can be no cooperation," said Steinmeier, who added that the EU has so far not seen any ''meaningful signals" from Hamas.

The decision to hold off on cutting aid was seen as a bid to pressure Hamas, which won the Jan. 25 Palestinian parliamentary elections, to shed its strident anti-Israel views and ensure EU aid continues to ease the economic plight of the Palestinian people.

Israel has already halted monthly transfers to the Palestinian Authority of some $50 million in tax receipts following Hamas's election victory.

The 25 EU foreign ministers grappled with the question of how Europe can remain the largest donor for the Palestinians without any of its aid ending up in the till of a government led by a faction both the United States and the EU consider a terrorist organization.

Hamas lawmaker Mahmoud Zahar reacted angrily to the demand his group fall in line with the peace process.

''What are the peaceful means?" he asked. ''Do they want us to respect Israel's decision to kill and detain our children?"

He urged the EU to issue a response to Israeli actions against Palestinians. ''They shouldn't just talk about the Palestinians, but also about Israel," he said.

In 2005, EU governments and the EU executive commission together gave about $600 million to the Palestinian Authority. Officials said half of that came from the European Commission, from which annual aid fluctuates.

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