US mulls direct assistance to Palestinian Authority

"It's an idea that is under consideration," the State Department deputy spokesman Adam Ereli said on Thursday.

"No decision has been made," the US official said, declining to say how much aid the administration intended to give to the Palestinian Authority.

"We are interested in ways that we can help support the Palestinian people and the Palestinian leadership as they try to emerge from the past years of conflict and violence," Ereli said.

Against the backdrop of US accusations of corruption, the administration this year bypassed the Authority and contributed US$ 127 million to Palestinians through the United Nations and private groups.

Last year, US$ 20 million was given to the Authority. It was "fully accounted for and used in the way it was intended," Ereli said.

"We only gave it when we were assured and confident that the institutions and processes to guarantee accountability and transparency, were in place," he said.

Outgoing US Secretary of State Colin Powell is scheduled to hold talks in Israel and with Palestinians on the West Bank on Sunday and Monday. He told reporters on Wednesday that he wanted to discuss moves for the establishment of a Palestinian state, co-existing peacefully with Israel.

AFP adds: Prime minister Ahmed Qorei called for an end to "armed chaos" in the occupied territories Thursday as the interim Palestinian leadership held a raft of talks with political factions here.

"Armed chaos must cease, armed demonstrations must cease. Everybody must respect law and order," Qorei told AFP after attending meetings with MPs from the Gaza Strip and various leftist groups.

"The current chaos is in no one's interest, except for those who benefit from it personally," said Qorei who also heads the National Security Council.

He said that the dominant Fatah party was examining ways "to put an end to armed chaos, maintain order and impose the rule of law."

Following a meeting of the Fatah central committee later Thursday, a statement was issued that also called for "rapidly putting an end to the security chaos."

Fears that Yasser Arafat's death last week could worsen the already fragile security situation in the West Bank and Gaza Strip were underlined on Sunday when gunmen opened fire inside a mourning tent for the late Palestinian leader.

The gunfight erupted shortly after the arrival of new Palestine Liberation Organisation (PLO) chairman Mahmud Abbas, who led an unsuccessful campaign while prime minister last year to persuade militants to lay down their weapons.

He did manage to secure an agreement among factions such as Hamas and Islamic Jihad to halt their campaign of anti-Israeli attacks, but the ceasefire broke down after just seven weeks.