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updated 2/23/2009 5:54:07 PM ET 2009-02-23T22:54:07

The United States plans to pledge more than $900 million to help rebuild Gaza after Israel's invasion and strengthen the Western-backed Palestinian Authority, a U.S. official said on Monday.

The money will be channeled through U.N. and other bodies and will not be distributed via the militant group Hamas, which rules Gaza, said the official, who spoke on condition of anonymity as U.S. Secretary of State Hillary Clinton plans to make the announcement next week at a Gaza donors conference in Egypt.

Clinton is set to visit Israel and the West Bank next week after attending a conference in Cairo on Gaza reconstruction, Israeli and Palestinian officials said Monday.

Clinton will arrive in Israel on March 2 for two days and will meet with the country's top leaders, the Israeli officials said, speaking on condition of anonymity because the visit has yet to be announced by the State Department.

Clinton will also be visiting the West Bank to meet Palestinian officials, according to Yasser Abed Rabbo, a senior aide to Abbas.

"This money is for Gaza and to help strengthen the Palestinian Authority. It is not going to go to Hamas," the official told Reuters.

Neither the United States nor Israel have direct contact with the Islamist Hamas movement, which runs Gaza and remains formally committed to the destruction of the Jewish state.

The official said the pledge was a mix of money already earmarked for the Palestinians and some new funding.

"The package is still shaping up," he said, when asked for specifics over how the money would be spent and a breakdown of old and new funding.

In December, the former Bush administration said it would give $85 million to the U.N. agency that provides aid to Palestinian refugees in the West Bank, Gaza, Jordan, Lebanon and Syria.

Preliminary estimates put damage from the offensive, in which 1,300 Palestinians died, at nearly $2 billion.

Clinton's bid to get "substantial" funds could face an uphill battle in Congress because Hamas continues to rule Gaza and the U.S. focus is on its own souring economy.

Boost for Abbas
Part of the goal of the new funding is to boost the Palestinian Authority of President Mahmoud Abbas, which controls the occupied West Bank.

The United States wants Abbas's PA to play a central role in the reconstruction effort in Gaza, hoping this will increase its influence in the Hamas stronghold. Washington is also putting pressure on other donors to bolster Abbas.

"We call on donor countries to focus their pledges to meet the Palestinian Authority's priorities, including budget support, and on projects that can be funded through the Palestinian Authority and other existing, trusted mechanisms," said a State Department official.

The quartet of Middle East mediators — the United States, the European Union, Russia and the United Nations — are expected to meet on the sidelines of the Egyptian conference where they will work on strategy on Gaza, U.S. officials said.

After attending the conference in Egypt, Clinton is expected to go to Israel and the West Bank — a public demonstration of Obama's promise to make Arab-Israeli peacemaking a foreign policy priority.

Clinton's special envoy to the region, George Mitchell, will be there this week trying to revive stalled Palestinian statehood talks complicated both by Hamas and political uncertainty in Israel after last week's election.

Israel fires truce negotiator
In another development, Prime Minister Ehud Olmert dismissed Israel's top negotiator in Gaza truce talks for publicly criticizing his demand that Palestinian militants hand over a captured Israeli soldier before any deal is clinched, officials said Monday.

The move threatens to roil the talks just weeks before Olmert is succeeded by the hawkish Benjamin Netanyahu, who wants Gaza's Hamas rulers toppled and likely would take a tougher line in the Egyptian-brokered truce negotiations.

A truce deal has implications beyond cementing the informal Jan. 18 cease-fire that ended Israel's war on Hamas. Without it, there is little chance of advancing already troubled talks to reconcile feuding Palestinian factions.

Olmert abruptly announced last week that Israel would not reopen Gaza's long-blockaded borders — the main Israeli concession sought by Hamas — unless Hamas-affiliated militants first freed Sgt. Gilad Schalit, who was seized in a June 2006 cross-border raid.

Amos Gilad, the fired negotiator, opposed linking the truce deal with Schalit and criticized Olmert's strategy in an interview last week with the Israeli newspaper Maariv. After Gilad refused to apologize, Olmert gave him the boot, aides said Monday.

"Due to the inappropriate public criticism leveled by Mr. Gilad, he cannot continue as the prime minister's envoy to any political negotiations," Olmert's office said in a statement.

Aides said the talks would not be affected. A longtime adviser to Olmert, Shalom Turgeman, will replace Gilad in the truce talks, while veteran negotiator Ofer Dekel will handle efforts to free Schalit, the aides said, speaking on condition of anonymity because of the sensitivity of the talks.

There was no immediate reaction from Gilad or Egypt.

Hamas shrugged off the development, with spokesman Fawzi Barhoum saying Israel "never intended to reach any agreement or closure on a truce or a prisoner exchange."

This article contains reporting from Reuters and The Associated Press.

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