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Thu 26 Feb 2009 02:23 AM

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Palestinians seek Gaza cash

Palestinian Authority to seek $2.8bn to rebuild Gaza as Israel warns of further possible military action.

The Palestinian Authority said on Wednesday it will seek 2.8 billion dollars to rebuild Gaza, as Israel warned of another military strike if arms smuggling into the Hamas-run enclave continues."We have prepared a document on the basis of which donors will make their aid pledges. It foresees a total of 2.8 billion dollars for all sectors," Palestinian prime minister Salam Fayyad said at the headquarters of his Western-backed government in the Israeli-occupied West Bank.

"This document was prepared by the Palestinian Authority with the participation of all concerned parties and contains, in addition to the required aid, mechanisms that will allow donors to start reconstruction."

More than 70 countries are expected at the March 2 meeting in Egypt, which has been mediating a consolidation of the Gaza truce after Hamas and Israel declared on January 18 their own ceasefires to end a 22-day war that killed more than 1,300 Palestinians and 13 Israelis.

Sporadic attacks have continued on both sides since and Israel has linked any truce and the lifting of its blockade on the impoverished Palestinian territory to the release of a soldier seized by militants in June 2006.

Foreign Minister Tzipi Livni warned on Wednesday that Israel would launch another military "operation" in Gaza if the alleged smuggling of arms from Iran to the territory's Hamas rulers continues.

"Iran must be made aware that the weapons smuggling to Syria, Lebanon and Hamas constitutes a severe violation of international agreements," she said.

"If the weapons smuggling to Gaza continues Israel will have no other option than to initiate another defensive operation."

Israel has long accused its arch-rival Iran of supplying weapons to Hamas via hundreds of smuggling tunnels beneath the porous Gaza-Egypt border, charges Tehran has always denied.

One of Israel's key conditions for ending the fighting was a complete halt to arms smuggling into Gaza, and in the past month its warplanes have repeatedly struck the border area in a bid to blow up tunnels.

On Wednesday the military said it had destroyed seven smuggling tunnels along the border with an aerial raid after Palestinian militants fired two rockets at southern Israel. No one was wounded or killed in either attack.

US Secretary of State Hillary Clinton, who will attend the Gaza conference, has meanwhile been pressing Israel to stop blocking aid to the besieged territory, an Israeli newspaper reported on Wednesday.

US Middle East envoy George Mitchell is expected to issue a strongly worded statement on the situation when he travels to Israel this week, Haaretz said.

Clinton has relayed messages to Israel about the aid issue in the past week, and senior aides have made it clear the question would be central to her own visit to Israel next week.

Israel insists it will not reopen its crossing points into Gaza until Hamas releases Gilad Shalit, a soldier captured by Palestinian militants in a deadly cross-border raid from Gaza in June 2006.

The Gaza Strip has been under a tight Israeli blockade since Hamas seized power in June 2007, ousting forces loyal to Palestinian president Mahmud Abbas whose power base is now limited to the West Bank.

Humanitarian agencies have repeatedly called for better access to the Gaza Strip, which Israel has sealed off from all but vital aid since the Hamas takeover.

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