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Palestinian Backers Grow Impatient

International donors to the Palestinian Authority expressed impatience with the Mideast peace process Wednesday, urging Israelis and the Palestinians to show concrete progress or risk losing global financial support for the region.

The donors were gathered in Rome at their annual meeting to discuss the Palestinian budget, which receives 60 percent of its funding through foreign aid. Palestinian officials were seeking commitments of about $1.2 billion.

Also Wednesday, Israeli Foreign Minister Silvan Shalom met with Egyptian President Hosni Mubarak, a key mediator in peace efforts, in Geneva.

Shalom told Army Radio that Egypt expressed interest in "warming relations" with Israel, and Mubarak was committed in principle to returning the Egyptian ambassador, recalled three years ago when Israeli-Palestinian peace talks collapsed and fighting erupted.

Hours later, Shalom held talks with his Palestinian counterpart, Nabil Shaath, in Rome, Israeli sources said.

Shalom and Shaath said they are working to arrange a meeting between their prime ministers soon, but insisted it must be well-prepared, Haaretz newspaper reported.

Meanwhile, Palestinian leader Yasser Arafat on Wednesday dismissed as meaningless Israeli Prime Minister Ariel Sharon's reported comments that he would move some Jewish settlements as part of a unilateral plan for dealing with the Mideast conflict.

"It's all a show," Arafat told reporters outside his compound in the West Bank town of Ramallah.

Palestinian officials have condemned unilateral moves by Israel, saying they would never lead to peace, and urged Israel to focus instead on returning to the negotiating table to work out a peace deal.

Sharon's plan is likely to win the support of his ruling Likud party, reports CBS News Correspondent Robert Berger. It calls for settlements to be removed to create a defensible, unilateral border. Some West Bank land would be annexed. By endorsing the plan, the Likud is abandoning its ideology of controlling all the West Bank and Gaza Strip.

During Wednesday's opening session of Palestinian supporters, many speakers voiced optimism about recent efforts by Palestinians to bring militant groups into a truce to end three years of bloodshed. They also made clear that their patience is wearing thin. Violence by both sides has impeded international assistance efforts, and Israeli military strikes have wrecked dozens of donor projects.

"If this does not change, governments will have to reconsider their commitments and priorities" in the Palestinian territories, said Norwegian Foreign Minister Jan Petersen. Norway, a co-chair of Wednesday gathering, is one of the largest international donors to the Palestinian budget.

"The truth is that both sides must do better, to ensure for donors both a secure operating environment and the freedom to operate," said William Burns, a U.S. Mideast envoy.

Despite the tough words, there was no indication that any donor would immediately halt assistance. It was not clear whether donors would announce new commitments, although Italy pledged to maintain annual support of about $94 million.

The meeting Wednesday between the foreign ministers was the highest-level contacts since a new Palestinian government was formed last month.

"The impatience with the continued confrontation is very evident," Shaath admitted. "I think it's a pressure for both of us ... to seek ways and means of ending the confrontation, and that's what we are doing."

"While I'm aware of growing donor fatigue, I ask the donor countries to maintain their involvement. We are ready to help facilitate this involvement as best as conditions allow," Shalom said before the meeting with Shaath. He said Israel is committed to improving the lives of Palestinians.

Envoys of the United States, European Union, United Nations, Japan and Russia underlined in their speeches that both sides must resume talks based on the internationally backed "road map" peace plan.

The road map envisions an independent Palestinian state by 2005 and requires Israel and the Palestinians to take a series of steps in the interim.

The Palestinians were urged to halt attacks on Israelis and make more progress with financial and political reforms.

Italian Foreign Minister Franco Frattini said there could be "no ambiguity" on international demands that Palestinian Prime Minister Ahmed Qureia put an end to terrorism.

Israel came under criticism for its harsh crackdowns in the West Bank and Gaza, which it largely reoccupied in 2002 after a string of suicide bombings.

U.S. Middle East envoy David Sutterfield will arrive at the end of the week for separate talks with Israeli and Palestinian Authority leaders, and will ask to hear details of Sharon's plan.

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