EU aid to Palestinians may shrink if talks fail

The European Union could rethink the future size of its 300 million euro ($370 million) aid budget for Palestinians if no progress is made towards peace soon, EU diplomats said on Monday.

The aid is supposed to prepare the Palestinians for a peace treaty with Israel that will give them their own state, but "if that isn't coming then I can see a number of questions", said Christian Berger, the EU's representative in Jerusalem. (Reuters)