Rice said the US also intended to contribute $40m to the United Nations Relief and Work Agency, which provides aid to refugees in the Gaza Strip, “to help ease the suffering of all Palestinians”.
“We will not leave 1.5 million Palestinians at the hands of terrorist organisations,” she said.
“Hamas must decide what their objective is – is it power, is it Israel’s destruction, or is it peace for the Palestinian people?
Chris, Stockholm, Sweden
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Javier Solana, the EU foreign policy chief, said the 27-nation bloc would now begin sending funds to the Palestinian government and would examine ways to get aid to people in the Hamas-controlled Gaza Strip.
Solana did not say when aid would restart or how much would be made available.
“The EU will resume normal relations with the Palestinian Authority immediately,” EU foreign ministers, meeting in Luxembourg, said in a statement.
They also urged Israel to start paying millions of dollars in tax revenue it has withheld since Hamas’s poll victory.
Tzipi Livni, their Israeli counterpart, said at the Luxembourg meeting that Israel was willing to work with those who accepted Israel’s right to exist, adding there was still a need to meet the Palestinians to discuss transferring the money.
“It is part of our aspiration, part of our goal that the Palestinians understand that there is hope with the moderates,” she said. “There are of course certain questions … but we are not looking for excuses. We believe time is of the essence.”
The decision to withhold tax revenues and suspend direct aid had a crippling effect on the Palestinian econmoy and meant many Palestinians went unpaid for months.
Meanwhile, at the first working meeting of the new 12-member cabinet Salam Fayyad, the prime minister, said the priority for his new administration was to maintain security in the West Bank.
But it is unclear how much influence Abbas’s government can have in Gaza, as it is separated from the West Bank by 45km of Israeli territory and is now totally controlled by Hamas forces.
When asked how he would enforce the law in Gaza, Abdel-Razzak Yahya, the interior minister said: “I swear to God I do not know”.
Ismail Haniya, the prime minister in the cabinet dismissed by Abbas, has said he still considers the three-month-old unity coalition as the legitimate Palestinian government and accuses Abbas of participating in a US-led plot to overthrow him.