"We cannot begin reconstruction without peace," Andrew Natsios, head of the US Agency for International Development told a news conference in Nairobi in neighbouring Kenya on Thursday.

He said Washington planned a 25% increase in aid for next year.

"The US government would increase aid to Sudan to $ 200 million in 2004 from $ 160 million this year and would open a field office based in Nairobi," Natsios said.

The Sudan government has been in talks with southern rebels to end a 25-year long civil war.

"The US government would increase aid to Sudan to $200 million in 2004 from $160 million this year"

Andrew Natsios
US Agency for International Development

Natsios said the US government would shift its spending from humanitarian assistance and direct it instead towards projects aimed at rebuilding Sudan.

UK help

United Kingdom also said it hoped to increase spending on relief and other activities in Sudan once a peace deal is signed.

"Officials are working on plans for substantial increases in the years to follow a peace agreement," Alan Goulty, UK's special representative for peace in Sudan said.

"It is practical support for peace building and government structures rather than a tremendous shower of money," he said.

Goulty said a peace deal could help unlock $ 465 million of European Union assistance that had been frozen since 1991, and provide a fresh incentive for donors to help the government in Khartoum win debt relief.