BERLIN - The Palestinian prime minister sought international support for strengthening his police force and court system at a German-hosted conference Tuesday, a drive that officials said is critical to the establishment of a Palestinian state.

Germany hoped representatives from more than 40 countries at the one-day gathering would commit US$183.6 million (€118.29 million) to projects that include building a forensic lab and prisons, installing communications networks, and building and running courthouses.

International Middle East envoy Tony Blair said that improving Palestinian security "is fundamental to the two-state solution," with Israel and a Palestinian state living side by side.

U.S. Secretary of State Condoleezza Rice said that "security and the rule of law represent the foundations of any successful, responsible state."

German diplomats have put the funding requirements at US$183.6 million over three years, of which US$56 million is intended to go to the judicial system. The bulk of the funding was expected to come from the US$7.4 billion promised to help Palestinians at a donors' conference in Paris last year.

Israeli Foreign Minister Tzipi Livni stressed that, for Israel, law enforcement and security "are the basic requirements that must be met in order to create a Palestinian state."

"It is not enough to determine the borders of a future Palestinian state," she said. "When handing over the keys to the Palestinians, we must know that our neighbor is not a failed state or a terror state but a partner in peace."

Palestinian Prime Minister Salam Fayyad said improving the Palestinian Authority's police and creaking court system also was a matter of self-interest.

"It is not a question of Israel or the international community demanding it of us," Fayyad said. "Security is the most important service any responsible government must provide to its citizens. It is as much a Palestinian interest as an Israeli interest."

Over the coming months, the European Union aims to expand its 32-strong police mission to the Palestinians to 70 training personnel in the coming months - including judges, prosecutors and other legal experts.

The so-called EUPOL COPPS mission has been bolstering a now 900-strong civil police force. It plans to widen its focus to improving jails and how courts operate.

The mission's leader has said the court system is seriously backed up, with 80 percent of prisoners in Palestinian jails waiting to be sentenced.

The funding being sought is for the Palestinian Authority-controlled West Bank; the authority does not control the Gaza Strip, taken over last year by the Islamic militant group Hamas.

Even so, tensions over the situation in the Middle East were evident as Tuesday's conference opened. Israel and the Palestinians have a stated aim of reaching a peace deal by the end of the year, which would lead to the setting up of a Palestinian state.

Fayyad pointed to a Tuesday morning raid in the West Bank town of Nablus as an example of persisting difficulties. Israeli troops killed a senior Islamic Jihad commander in the raid, while a neighbor said a Palestinian bystander was also shot dead by troops.

The raid is "an example of the kind of activity that has to stop and stop immediately and promptly if, in fact, we are going to succeed in the provision of security to our people," Fayyad said. "The morale of our troops is at stake here, the credibility of the effort is at stake, our own political credibility will continue to be at stake so long as those kinds of incursions continue."

Arab League Secretary-General Amre Moussa warned that time was running short to reach a peace deal on target. "Show us progress, we don't see any progress," he said.

For negotiations to work, Moussa said, there needed to be an end to Israeli settlement building, meaningful and serious negotiations, reconciliation between Fatah, which runs the Palestinian authority, and Hamas; and Palestinian security and rule of law.

Rice said that "no one would be happier to see a reconciliation between the Palestinians than I would," but underlined the need for Hamas to recognize Israel's right to exist and for the situation in Gaza to return to what it was before the group's takeover.

"You cannot have reconciliation for peace if there is not a partner that respects the right of the other partner to exist," she said.

Following the conference, Rice and Russian Minister Sergey Lavrov plan to attend a meeting of the Quartet of Middle East peacemakers, made up of Russia, the United States, the U.N. and the European Union.