Congressional aides on Friday said the Bush administration had proposed more than $ 400 million in aid to Sudan for next year, but existing sanctions prevent the development assistance from reaching government-controlled areas.

The aides said if Sudan met Washington's conditions, the administration would ease those restrictions and provide the money as part of an international reconstruction package.

As a further inducement to end Africa's longest running civil war, the administration is dangling the prospect of holding a White House ceremony to mark a peace agreement between the Sudanese government and the southern rebels.

Under pressure from Washington, the Sudan government and the rebel Sudan People's Liberation Army signed agreements on Wednesday on how to share power and manage disputed strategic areas, clearing the way for a full peace deal.

Darfur ceasefire

On Friday, Khartoum and the two main rebel groups fighting in Darfur agreed to allow international observers to monitor a ceasefire.

The UN and US have sought an
end to the conflict

Currently, US development money only goes to aid groups working outside government-controlled areas, while US humanitarian assistance, including food aid, can go to government-controlled areas and Darfur.

Congressional aides said next year's package would include approximately $ 286 million in development assistance for road-building, health care, education and other projects, in addition to $ 100 million in food aid.

"If there's a peace deal, they are going to crank up help for infrastructure improvements," one aide said.