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France says Europe must be more than 'bank window' in Israel, Palestinian conflict

PARIS (Reuters) - French President Francois Hollande said on Thursday Europe had to play a bigger role to help resolve the Israeli-Palestinian conflict and could no longer just play the role of a "bank window" for reconstruction after each war.

An open-ended ceasefire in the Gaza war began earlier this week as Prime Minister Benjamin Netanyahu faced strong criticism in Israel over a costly conflict with Palestinian militants in which no clear victor emerged.

The European Union is the biggest aid donor to the Palestinian Authority and Israel's biggest economic partner, accounting for almost a third of its exports and imports.

However, it is deemed as having little influence in efforts to reach a negotiated solution between both sides.

"For a solution to finally be reached, the United States' role will be decisive," Hollande said in an annual speech to French diplomats outlining foreign policy objectives.

"But Europe's role is as important. It must act more. Europe does a lot to rebuild and develop Palestine, but it can't simply just be a bank window where we turn to heal the wounds after a recurring conflict."

Paris has already said that if peace negotiations ultimately fail then the international community would have to take the lead to find a solution.

"We have to go towards a progressive lifting of the blockade and the demilitarization of the territory," he said, referring to a British-French-German proposal for creating a Gaza monitoring mission.

Hollande said once the ceasefire was consolidated the path to peace would have to be taken as quickly as possible.

   "Everyone knows the conditions: a democratic and viable Palestinian state living side by side with an Israeli state living in security."

(Reporting By John Irish Editing by Jeremy Gaunt)

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