U.S. to pledge $500-$600 million for Palestinians

WASHINGTON (Reuters) - The United States will pledge between $500 million and $600 million in aid to the Palestinians at a donors conference in Paris next week, two U.S. officials said on Friday.

The officials, who asked not to be named because the figure has not been announced, could not say if the sum would include the roughly $400 million that U.S. President George W. Bush has already requested from the U.S. Congress for the Palestinians this year.

The money, which is to be announced on Monday the conference hosted by France, aims to bolster Palestinian President Mahmoud Abbas against Hamas Islamists as he embarks on the first Israeli-Palestinian peace talks in seven years.

The one-day meeting is the financial sequel to last month's U.S.-sponsored Annapolis conference which launched formal peace talks aiming to brokering a deal on Palestinian statehood before Bush leaves office in January 2009.

The Palestinian Authority, led by Abbas and his Fatah faction, is expected to ask donors for around $5.6 billion over three years for budgetary support and for development in the West Bank and the Hamas-controlled Gaza Strip.

There remains considerable skepticism among diplomats and analysts about whether a peace agreement is possible next year given the Hamas-Fatah divide among the Palestinians and the political weakness of Israeli Prime Minister Ehud Olmert.

Hamas, which opposes the new peace talks that formally began on December 12, seized control of the Gaza Strip in June, while Fatah governs the West Bank.

All the international players agree on the need to help Abbas reform the Palestinian Authority's institutions and to bolster its finances.

France invited foreign ministers of 69 countries to attend -- the states that were at Annapolis, as well as all of the European Union and other key political and economic players.

Regional powers Syria, Jordan, Egypt and Saudi Arabia are among the guests, as are Russia, India and China.

U.S. Secretary of State Condoleezza Rice will represent the United States and Israeli Foreign Minister Tzipi Livni -- who leads the Israeli peace negotiating team -- will also attend.

Rice is expected to arrive in Paris on Sunday and to hold talks with Palestinian Prime Minister Salam Fayyad that night before attending the donors conference.