Arab leaders agreed at a summit on Tuesday to help rebuild the battered Gaza Strip, but differences persisted over finding a united stance on the three-week Israeli offensive that killed more than 1,300 people.

The conflict in Gaza underscored the Arab divide between those allied to Egypt and Saudi Arabia on one side, and those allied to Syria and Qatar on the other.

Arab leaders condemned Israel's attack and demanded its immediate withdrawal from Gaza in the final statement read by Arab League Secretary-General Amr Moussa. It said Israel should punish those who committed war crimes during the offensive.

"The summit is holding Israel legally responsible for war crimes it committed and for taking the necessary action to pursue those who committed the crimes," Moussa said.

Differences over the strength of the wording on Gaza in the declaration delayed the summit's concluding session.

Last week, clusters of leaders met at different meetings to formulate resolutions, but neither set was included in the final declaration.

A meeting of Arab foreign ministers in Kuwait on Friday prepared a set of resolutions, including a pledge of support for the Palestinian Authority headed by President Mahmoud Abbas.

But another meeting in Doha took a much stronger line, calling on Arab countries to review their ties with Israel and to suspend a 2002 Arab peace initiative.

The 2002 peace initiative offered Israel normal relations in return for full withdrawal from all Arab land occupied in the 1967 Middle East War and a just solution to the issue of Palestinian refugees.

King Abdullah said on Monday the initiative was still on the table, but that Israel should not expect it to stay forever.

On Monday, Abbas, who controls the West Bank but lost control of Gaza to Hamas in 2007, called for reconciliation and the formation of a national unity government to pave the way for presidential and parliamentary elections.

Abbas is backed by the West but seen as weak by leaders of some Arab states such as Syria.

AID AND ENERGY

The final declaration omitted detail on the size of a fund to rebuild Gaza. Foreign ministers meeting on Friday had adopted a resolution to establish a fund of up to $2 billion (1 billion pounds) fund that leaders were expected to back. Saudi Arabia committed $1 billion towards reconstruction on Monday.

The declaration focussed on increased economic cooperation and inter-regional investment, with the emphasis on energy.

It called on Arab states to work together to tackle the impact of the global financial crisis on the region and to take part in global efforts to restore financial stability. The declaration urged financial institutions to facilitate credit.

World Bank President Robert Zoellick told Arab leaders in a speech to the summit on Monday that the Arab world must be a part of the global response to the crisis. Western governments have also asked cash-rich Arab oil exporters to contribute to efforts to ease the crisis.

Arab central bankers and finance ministers meeting ahead of the summit last week urged their governments to keep state spending high to shore up domestic economies amid a collapse in oil prices and recession in the industrialised world.

The slump in oil prices has slowed a phase of rapid regional growth, battered investor confidence and strained budgets.

Arab leaders called for cooperation in the use of nuclear energy for peaceful purposes and the expansion of regional power grids and natural gas networks.

(Writing by Simon Webb; Editing by Dominic Evans)