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PORT-AU-PRINCE, Haiti - By MICHAEL NORTON, Associated Press Writer -The Organization of American States urged the resumption of blocked aid to Haiti on Wednesday, saying member countries are concerned about a possible "humanitarian disaster" in the hemisphere's poorest nation.

In a resolution approved by the OAS in Washington, the diplomatic organization backed the "normalization of economic cooperation between the government of Haiti and the international financial institutions" that froze hundreds of millions of dollars in aid after flawed 2000 elections.

"This is great news," Haitian Finance Minister Faubert Gustave said in the capital of Port-au-Prince, adding that he hopes international donors "will follow through."

The aid amounts to about dlrs 500 million, and includes about dlrs 150 million in low-interest loans from the Inter-American Development Bank, officials said.

The international community, including the United States and European countries, blocked aid to the government after President Jean-Bertrand Aristide's party swept more than 80 percent of legislative and local seats in 2000 elections. The opposition charged the elections were rigged.

The OAS determined that winners were wrongly declared in seven Senate races that should have gone to a second round, and said aid would be frozen until the government and opposition agreed on new elections.

OAS officials tried more than 20 times to broker an agreement, but failed. Haiti's chronically depressed economy, meanwhile, further declined while poverty proliferated.

The 34 members of the OAS Permanent Council unanimously backed the resolution, in which they urged Haiti and foreign donors to "resolve the technical and financial obstacles" to the restoration of aid.

They cited "the continuing deterioration of the socio-economic situation in Haiti ... and its potential for humanitarian disaster."

The OAS also urged the holding of new elections next year, and called for "the restoration of a climate of security."

Aristide's Lavalas Family party and the opposition alliance Convergence broke off talks on the holding of new elections after a Dec. 17 armed attack on the National Palace. At least 10 people were killed in the attack and subsequent violence.

U.S. representative Peter DeShazo said the U.S. government "reserves the right to make decisions on international financial institution projects in Haiti on the merits of each individual proposal."

This year's dlrs 55 million U.S. aid package to Haiti is being channeled through non-governmental organizations. The European Union ( news - web sites) has promised a five-year, dlrs 350 million aid package if the government and opposition agree on new elections.

"Lavalas and Convergence, as fellow Haitians, will continue their dialogue with mutual respect," Aristide said Wednesday after returning from the World Summit in South Africa.

He did not comment on the OAS resolution, but urged the opposition to resume talks.

Convergence refuses to negotiate with the government until Aristide supporters are disarmed and those accused of political violence are brought to justice.

"We never asked the OAS to block aid to Haiti," said Convergence spokesman Mischa Gaillard. "Let's hope the money from resumed aid will serve the people and not be diverted into the pockets of our corrupt rulers."