At the Egyptian resort of Sharm el-Sheikh on Monday, Clinton pledged the additional aid to help rebuild the Gaza Strip after Israel's 22-day offensive in the territory in December.

About 1,300 Palestinians and 13 Israelis died during war, before unilateral ceasefires were declared by Israel and Palestinian factions in the Gaza Strip.

Statehood inevitable

During her visit to the Middle East, Clinton has emphasised the need for rocket fire from the Gaza Strip into Israel to end, and defended Israel's right to respond to such attacks.

However, she has also said that a Palestinian state is the "inevitable" and "inescapable" outcome of any peace effort.

"During the conference, I emphasised President [Barack] Obama's and my commitment to working to achieve a two-state solution to the conflict between Israel and the Palestinians and our support for the Palestinian Authority," Clinton said.

The statement raises the possibility of disagreement with Benyamin Netanyahu, the Israeli prime-minister designate, who has said in the past that the Palestinians are not ready for statehood.

Netanyahu is currently attempting to assemble a ruling coalition, likely to be made up for hard-right and religious parties, after elections last month.

Though Obama has said that an Arab-Israeli peace deal will be a priority during his presidency, talks between Israeli officials and the Palestinians have stalled over violence, settlement-building and disputes over other core issues such as the future of Jerusalem and Palestinian refugees.

The PA suspended the negotiations after Israel launched its offensive on Gaza, with a stated aim of ending Palestinian rocket fire into the south of the country.