Prime Minister Paul Martin announced on Friday that Canada would provide US 9.7 million dollars in aid to Palestinians.
The announcement came following his meeting with Palestinian leader Mahmoud Abbas.
The money is to be used to help the Palestinians build new homes, manage territorial borders and strengthen the state's legal system.
Martin praised Abbas, who was making his first official visit to North America since he was elected in January.
"President Abbas has demonstrated his commitment to reform and his commitment to peace; he has rejected terrorism, he has rejected violence," Martin said.
"We commend him for his for his strong leadership and we reiterate our support for all that he is doing."
Martin, who called the US$9.5 million commitment "just a down payment," noted it was in addition to the US$8 million Canada spends annually for education, health and relief through the UN Relief and Works Agency for Palestine Refugees.
As well, Canada will deploy 50 observers for the upcoming Palestinian Legislative Council elections and add four officers to the team of 28 Canadians already patrolling Egypt's Sinai Peninsula as part of a multinational force.
"I think that there is an enormous amount that we can do to help the Palestinian Authority and we intend to play that role ... (including) the role of intermediary between the various parties," Martin said prior to the meeting, signalling his intention to "eventually" travel to the Middle East.
"Canada has a very good reputation in the Middle East and has a balanced approach in the region and that would allow Canada to play an honest broker in the peace process," he said.
