Palestinian Prime Minister Salam Fayad called Wednesday on the European Union to renew aid to the Palestinian Authority and spoke of the need to launch a "real" peace process which will lead to a result "we all expect."

He made the comments after meeting European Union foreign policy chief Javier Solana in Ramallah.

"We discussed the latest developments and we discussed several important issues at all levels," he said, describing what transpired during what he termed a "positive meeting" with the European envoy.

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Mahmoud Abbas, who met with Solana later, said he would welcome any renewal of aid to the Palestinians.

The international community has begun pledging aid to the Palestinians again, following Abbas' dismissal of the Hamas-led unity government last month after the Islamist movement assumed control of the Gaza Strip in five days of savage fighting with gunmen loyal to Abbas's Fatah party.

Western countries, led by the United States, had imposed a diplomatic and economic boycott on the Palestinian government after Hamas won power in 2006 and refused demands to renounce violence or change its charter to accept Israel's right to exist.

Merkel urges Arab initiatives in Mideast; trips to Asia planned

German Chancellor Angela Merkel called Wednesday for Arab initiatives to be included in the Middle East peace process.

"It won't work without the involvement of regional players," the chancellor said in a press conference reviewing the progress of her 20-month-old coalition government.

Merkel repeated German support for the new initiative of US President George W Bush that envisages an international conference to explore ways of creating a Palestinian state.

She also welcomed the talks between Israeli Prime Minister Ehud Olmert and Palestinian Authority Chairman Mahmoud Abbas, saying they opened a timeframe for bringing stability to the West Bank.

Merkel, who spoke on the telephone Tuesday with Palestinian prime minister-designate Salam Fayad, said it was important to build stable institutions in the Palestinian Territories.

In his initiative announced Monday, Bush said U.S. Secretary of State Condoleezza Rice would chair a conference in the autumn that would consist primarily of the Israelis and Palestinians as well as Middle East countries committed to a two-state solution to the conflict.

Merkel also announced that she would make two trips to Asia and one to Africa in the second half of the year.

Her first one in early autumn would take her to China and to Japan, which takes over the rotating presidency of the Group of Eight leading industrial nations from Germany on January 1, 2008.

She said her talks with leaders of the two countries would concentrate on climate issues, nuclear matters and the role of emerging economies like China on the global stage.

A second trip to Asia in October would take her to India, Malaysia and Singapore, said the chancellor, who welcomed North Korea's decision to wind down its nuclear weapons program, calling it a victory for diplomacy.