Bush wants $400 million for Palestinians

The top American diplomat in Jerusalem said Monday that the Bush administration is seeking $400 million in new aid for the Palestinian Authority.

U.S. Consul General Jacob Walles told Palestinian journalists of the new request as preparations continue for a Mideast conference called by President Bush for later this year, aimed at restarting Israeli-Palestinian peace talks.

The United States and Israel have been showing support for Palestinian President Mahmoud Abbas, a moderate who is in a struggle with the violent Islamic Hamas. In June, Hamas overran the Gaza Strip, defeating security forces loyal to Abbas, leaving Hamas in control of Gaza and a new Abbas-appointed government in charge of the West Bank. The West responded by resuming aid cut off after Hamas won an election in 2006.

Walles said the administration will ask Congress for $400 million, half of which would be aimed at the private sector and infrastructure. He said $150 million would be earmarked for budget support and $25 million each would go to security and refugees.

The allocation would help counter a huge deficit in the Palestinian budget that followed the Western aid cutoff. Foreign aid covers about half of the Palestinian Authority's operating budget.

Since 1993, when Israeli-Palestinian interim peace accord was signed, the U.S. has given $1.7 billion in aid to the Palestinians, according to the USAid Web site.