Palestinians Launch New Housing Project Where Gush Katif's Morag Once Stood

Palestinian leader Mahmoud Abbas yesterday laid the cornerstone for a new housing project set to rise from the rubble of a former Jewish settlement, the first major construction project in the Gaza Strip since Israel completed its withdrawal from the territory last month.

Work is due to start today on the Sheikh Khalifa neighborhood, named after Sheikh Khalifa bin Zayed Al Nahyan, president of the United Arab Emirates, which is bankrolling the $100 million, two-year project. It is located at the site of the bulldozed Morag settlement, in the south of the coastal strip.

"We hope to start a new era of construction," Abbas said at the ceremony, carried live on Palestinian television. "Today we are laying the foundation stone for a Palestinian city on the remains of the Morag settlement to give a chance for our people to lead a normal life in dignity."

The UAE's Red Crescent Society last year paid $27 million for the reconstruction of the center of the West Bank's Jenin refugee camp. The area was destroyed during an Israeli military offensive in April 2002, when some 52 Palestinians and 23 Israeli soldiers were killed.

UAE Information Minister Abdullah bin Zayed Al Nahyan, brother of the president, attended yesterday's groundbreaking ceremony.

Palestinian officials say the completed project will provide free housing for 25,000 people who lost their homes in Israeli military actions, together with schools, mosques, medical facilities, a community center and green spaces.