Israel isn't creating basis for peace says U.N.

By Louis Charbonneau

UNITED NATIONS (Reuters) - Israel's treatment of the Palestinians in Gaza is not helping to create a basis for peace and could cause lasting damage to Gaza's economy, the United Nations' top humanitarian official said on Wednesday.

In January Israel sealed border crossings with the Gaza Strip in response to Palestinian rocket attacks against southern Israel. The United Nations has warned that this has resulted in a humanitarian crisis for the territory's 1.5 million people, most of whom depend on foreign aid.

"This doesn't look at all like a basis on which you can build a peace settlement, because at the end of the day, it's got to be built on political dialogue and trust and hope, rather than on despair and hatred and humiliation," John Holmes, U.N. under-secretary-general for humanitarian affairs, told Reuters in an interview.

The United States has been pushing the Palestinian Authority in the West Bank and Israel not to abandon peace talks and hopes negotiations could result in an accord before U.S. President George W. Bush leaves office next January.

Holmes said that if Israel thought sealing the borders of Gaza would cause the people there to rise up against the militant group Hamas, which seized power in Gaza in June 2007, there are no signs that it has been effective.

"The idea that somehow it's going to turn the people of Gaza against Hamas or at least stimulate them to rise up against Hamas and throw them out I think is not well founded," he said.

"It's not stopping the rockets, it's not producing the desired political effects, if that's indeed the intention."

Holmes reiterated the U.N. position that the blockade was a form of "collective punishment" for the population of Gaza, which would constitute a violation of international law.