The United States and European Union say they plan to resume direct aid to the new Palestinian government that does not include the militant group Hamas.
US Secretary of State Condoleezza Rice says the United States will have normal relations with the Palestinian government. She also says the US will provide 40-million dollars in humanitarian aid for Palestinians, mainly those in Gaza.
EU foreign policy chief Javier Solana says the bloc will resume aid to the new Palestinian government.
Palestinian President Mahmoud Abbas of the Fatah group dismissed the Hamas-led government last week, as Hamas seized control of the Gaza Strip in fighting with Fatah.
On Sunday, Mr. Abbas swore in the new cabinet headed by independent economist Salam Fayyad. Fatah remains in control of the West Bank.
The White House says US President George W. Bush pledged support for Mr. Abbas in a phone conversation Monday with the Palestinian president.
Mr. Bush plans to host Prime Minister Olmert on Tuesday at the White House for talks on the new Palestinian government and re-starting the Middle East peace process.
Mr. Olmert has said his country will work toward peace with the new Palestinian government if it becomes a "serious partner" in the West Bank.
Meanwhile, Palestinian hospital sources say Israeli troops killed a Palestinian man in an exchange of gunfire Monday at the Erez crossing between Israel and the Gaza Strip.
The sources say several Palestinians were wounded. The Israeli military says troops shot back after Palestinians threw a grenade and opened fire at the crossing