The Israeli Prime Minister, Mr Ariel Sharon, has called on the European Union to stop funding the Palestinian Authority. He claimed that the Palestinian leader, Mr Yasser Arafat, was spending EU money on weapons to kill Israelis.
Mr Sharon was speaking after a meeting with an EU delegation, including the Commission President, Mr Romano Prodi, the EU's foreign policy chief, Mr Javier Solana and the Belgian Prime Minister, Mr Guy Verhofstadt. The EU delegation asked Mr Sharon to drop his demand for seven days without violence as a precondition for peace talks with the Palestinians.
But Mr Sharon told them bluntly that although there had been a decline in violence during the past 12 days, he would not negotiate until it had stopped completely. "We need seven days to see how Arafat is going to implement the cease-fire. That has been our position and that is going to be our position in the future. Because I don't see how you can have peace without a complete cessation of all violence. It will not work," he said.
The US Secretary of State, Mr Colin Powell, is expected to echo the EU call for a more flexible approach from Israel when he makes a keynote speech on the Middle East today.
Mr Verhofstadt said yesterday the EU and the US were now united in their approach to the Middle East conflict. He sought to reassure Israelis that the EU could be an honest broker in the conflict and was not biased in favour of the Palestinians. "That is not true. We are neutral and we want to help both sides relaunch the peace process," he said.
The EU delegation were unable to disguise their disappointment at Mr Sharon's response to their visit and one official said that the Israeli Prime Minister had doomed any new initiative in advance. The delegation was taken aback when Mr Sharon began his statement to the press by describing Jerusalem as "the capital of the Jewish people for more than 3000 years and the united, undivided capital of Israel forever".
In Ramallah on Saturday, the EU delegation met Mr Arafat, who told them that he was willing to accept EU monitors to verify that he is doing everything possible to keep down the level of violence. He told them that the Palestinian Authority needed money to pay nurses, doctors and teachers and complained about Israel's continued refusal to pay customs duties owed to the Authority.
The EU has given more than €200 million in aid to the Palestinian territories during the past year and is the largest single donor in the region.
Mr Sharon said he shared the EU's desire to see the Palestinian economy prospering but he said Israel would not pay customs duties until Mr Arafat stopped the terrorist attacks. "Arafat's presidential guard and security organisation are paid by this Authority. We cannot pay the salaries of those who murder us," he said.
In Cairo on Saturday, Mr Prodi announced that Egypt will for the first time be added to the list of countries receiving food aid from the EU. A slump in tourism and reduced remittances from workers on the Suez Canal have caused a massive drop in Egypt's foreign currency receipts expected to total $2.5 billion this year. The country is experiencing shortages of wheat, sugar and vegetable oil.
