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Israel is discussing a deal to resettle Palestinians from Gaza in South Sudan, Reuters reported citing three sources.
The reported plan was quickly dismissed as unacceptable by Palestinian leaders.
The sources, who have knowledge of the matter but spoke to Reuters on condition of anonymity, said no agreement had been reached but talks between South Sudan and Israel were ongoing.
Reuters reported that Israeli Prime Minister Benjamin Netanyahu's office and Israel's foreign ministry did not immediately respond to a request for comment on the information from the three sources.
A spokesperson for the U.S. State Department told Reuters, "we do not speak to private diplomatic conversations," when asked about the plan and if the United States supported the idea.
Netanyahu said this month he intends to extend military control in Gaza, and this week repeated suggestions that Palestinians should leave the territory voluntarily.
Arab and world leaders have rejected the idea of moving Gaza's population to any country. Palestinians say that would be like another "Nakba" (catastrophe) when hundreds of thousands fled or were forced out during the Arab-Israeli war of 1948, Reuters reported.
The three sources said the prospect of resettling Palestinians in South Sudan was raised during meetings between Israeli officials and South Sudanese Foreign Minister Monday Semaya Kumba when he visited the country last month.
Their account appeared to contradict South Sudan's foreign ministry which on Wednesday dismissed earlier reports on the plan as "baseless".
News of the discussions was first reported by the Associated Press on Tuesday, citing six people with knowledge of the matter.