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CNN Live At Daybreak

Israel Going Ahead With Plans to Unfreeze Millions of Dollars in Palestinian Tax Revenue

Aired July 25, 2002 - 05:30   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ANDERSON COOPER, CNN CORRESPONDENT: Israel is going ahead with plans to unfreeze tens of millions of dollars in Palestinian tax revenue. It is a confidence building move following Tuesday's air strike in Gaza, which Israel now calls an "unfortunate mistake."

CNN's Chris Burns reports.

(BEGIN VIDEOTAPE)

CHRIS BURNS, CNN CORRESPONDENT (voice-over): The bodies of Palestinian children are still being pulled from the rubble of a Gaza apartment building bombed by the Israelis to kill one man, Hamas' military chief, Salah Shehadeh. More than a dozen civilians, most of them children, are dead. About 150 are injured.

Leftist activists say Prime Minister Ariel Sharon again sabotaged efforts to stop the violence.

UNIDENTIFIED FEMALE: Perhaps there was some kind of chance for a cease-fire. Now that chance has virtually been destroyed. And one wonders if it wasn't intentional.

BURNS: On the street, Israelis have split feelings.

UNIDENTIFIED MALE: Well, I'm happy the guy is killed. I'm really happy. I'll sleep better tonight. But I also do think a lot about the children, women and innocent people that got killed there.

BURNS: Foreign Minister Shimon Peres criticizes the bombing, but he's backed what Israel calls "our targeted killings of militants, including Shehadeh."

SHIMON PERES, ISRAELI FOREIGN MINISTER: Shehadeh is a local bin Laden. He's responsible for the killing of over 200 persons in our country. He was continuing to plan bloodshed.

BURNS: Despite the attack, Peres says he hopes to restart talks with the Palestinians in the coming days aimed at easing Israel's clampdown on the occupied territories. He told CNN Israel is going ahead with plans to unfreeze $45 million in Palestinian tax revenue withheld since the intifada began. That's 10 percent of the total.

Israel will also allow thousands more Palestinians to work in Israel and it's offering to withdraw from some West Bank cities if the Palestinian Authority can guarantee security, efforts that were under way last week.

SAEB ERAKAT, CHIEF PALESTINIAN NEGOTIATOR: I was meeting with Mr. Peres just 48 hours before the attack on Gaza. I think we had a very serious meeting. We have submitted to them a whole comprehensive plan, including the security obligations. We had urged the Israeli side to refrain from assassinations or what they call targeted killings or the closure and the siege and a rest to give our interval the chance it deserves. Because we know that such acts will just fuel the fire.

BURNS: Fire from kassam (ph) rockets like these, shot by Palestinians into southern Israel hours after Shehadeh was killed.

(on camera): And Hamas says more attacks are on the way, that all Israelis are now targets, that in the wake of Shehadeh's death, the Palestinian Authority has no business speaking with the Israeli government.

Chris Burns, CNN, Jerusalem.

(END VIDEOTAPE)

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