French President Jacques Chirac on Friday proposed the creation of a special account at the World Bank to channel international aid funds to the Palestinians and head off an impending financial meltdown in the territories.
The escrow account could be used to send payments directly to 160,000 Palestinian civil servants, thus bypassing the Hamas-led government, which is boycotted by the international community because of its opposition to peace with Israel.
Chirac made the suggestion during talks in Paris with Palestinian leader Mahmud Abbas, who is in France on the last leg of a European tour urging the resumption of aid.
Last month the 25-member European Union - the biggest donor to the Palestinians - decided to suspend non-humanitarian aid in order to put pressure on the newly-constituted Hamas government to participate in peace talks.
Accord to Chirac's spokesman, the president told Abbas that "France would propose to its European and international partners... that they reflect very rapidly on a mechanism to allow the resumption of aid."
In a press conference after the talks, Abbas welcomed the proposal. "We hope that solutions can be quickly found because the situation is critical. We want a legal and effective mechanism which can be rapidly put into place before the situation becomes irreversible," he said.