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Bush Authorizes Direct US Aid to Palestinian Authority

The Bush administration, citing an improving climate for Palestinian-Israeli peace efforts, is lifting a long-standing ban on direct U.S. aid to the Palestinian Authority. The United States will provide the Palestinians with $20 million in economic aid along with financial support for their upcoming elections.

The decision, heralding a major shift in U.S. policy toward the Palestinians, came in a brief notice to Congress by President Bush.

The President cited national security interests for his decision to issue a one-time waiver to a decade-old ban on direct aid to the Palestinian Authority.

The action clears the way for delivery of more than $20 million in U.S. aid to the Palestinian Authority, to help it deal with serious financial problems following the death of Yasser Arafat last month, and to prepare for elections January 9.

The Bush administration ceased all ties with Mr. Arafat in 2002, accusing him of not doing enough to stop terrorist attacks against Israelis.

U.S. officials have been speaking about a more promising environment for Middle East peacemaking since his death, and say the Palestinians deserve credit and support for the way they have handled the leadership transition.

At a news briefing, State Department Deputy Spokesman Adam Ereli said the waiver is a tangible sign the United States is prepared to help Palestinians at what he terms as qoute "unique juncture in their history":

"It is an important, and I think meaningful, signal of United States support for the Palestinian Authority, United States support for the Palestinian people, the United States commitment to trying to help them meet the challenges before them, and move forward in helping the Palestinian people achieve their aspirations," said Mr. Ereli.

In addition to $20 million in economic aid to the Palestinian authority, the United States will provide $2.5 million dollars in technical assistance for the Palestinian elections, and $1 million to help finance the presence of several hundred international observers for the voting.

Legislation banning direct transfer of funds to the Palestinian Authority was first approved by Congress in 1994 and continued each year, to ensure that U.S. tax money did not end up supporting Palestinian attacks on Israel.

Despite the restriction, the United States has remained the largest single donor of humanitarian aid to the Palestinians, with about $200 million provided annually, mainly through relief programs administered by the United Nations.

Bush administration officials discussed the new aid package with Palestinian finance minister Salam Fayad during a Washington visit by Mr. Fayad last week.

White House Press Secretary Scott McClellan said Mr. Fayad promised transparency and openness with regard to the use of the U.S. funds.

He said the administration has great confidence the money will be used for its designated purpose, improving public infrastructure in Gaza and the West Bank.