US asks Palestinians to return aid

WASHINGTON - The United States has asked the Palestinian Authority to return $50 million in US aid because Washington does not want a Hamas-led government to have the funds, the State Department said today.

The money was demanded as part of a full review of all US aid for the Palestinians that began soon after the militant group Hamas' surprise victory in elections last month. A Hamas-led parliament was set to be sworn in on Saturday but it could take several weeks for a Cabinet to be formed.

State Department spokesman Sean McCormack said the caretaker government of President Mahmoud Abbas agreed to return the money, given last year for infrastructure projects after Israel's withdrawal from Gaza and parts of the West Bank.

"In the interests of seeing that these funds not potentially make their way into the coffers of a future Palestinian government (made up of Hamas) ... we have asked for it to be returned and the Palestinian Authority has agreed," McCormack told reporters.

McCormack said the Palestinian Authority promised to return the unspent funds promptly.

Over the past decade, the United States has given about US$1.5 billion in aid to the Palestinians, mostly through aid groups.

McCormack reiterated US policy that aid could not go to Hamas, which is classified as a terrorist group, but he said the United States was looking at ways of ensuring humanitarian assistance could reach the Palestinians.

For a Hamas government to get direct aid, it would have to renounce violence, recognize Israel, disarm militias and agree to past Israeli-Palestinian agreements.

US Secretary of State Condoleezza Rice will be visiting Saudi Arabia, Egypt and the United Arab Emirates next week to discuss, among other issues, how to deal with Hamas and to convince those nations not to fill any funding gap.

The mediating powers in the Middle East -- the United States, European Union, the United Nations and Russia -- issued a statement last month in which they said Hamas must reject violence and recognize Israel or risk losing aid.

HUMANITARIAN CONCERNS

Several aid groups want the US government to grant a waiver for humanitarian assistance to enable them to communicate with a new Palestinian government.

Elizabeth Sime, country director for CARE's program in West Bank and Gaza, said world donors must understand that getting aid to the Palestinians required cooperation at least "on a technical level" with the Palestinian Authority.

McCormack told Reuters it was premature to talk about a waiver, adding it would be a few weeks before the review was completed.

Peter Gubser, president of American Near East Refugee Aid, said he feared his charity's school program might be affected by an aid cut because the group had to deal with the Palestinian ministries.

Like many others, his group was looking at how to shift aid in a way that complied with US law. A school program that would require dealings with the Palestinian Authority may be curbed and so his group might, for example, put more funds to their milk program for Palestinian preschoolers.

InterAction, an umbrella group representing about 160 aid groups, said there was concern any sharp cut in foreign assistance would create more unrest and hurt the weakest.

The group's president Mohammad Akhter said it was possible to work with civil society groups not linked in any way to Hamas. He pointed out the United States had given food aid to the North Koreans even though it opposed their polices.

- REUTERS