RAMALLAH, West Bank - The Palestinian prime minister said he had failed to win assurances from Israel's defense minister yesterday that stifling restrictions on Palestinian movement would be eased - a step seen as key to the success of an ambitious international effort to revive the Palestinian economy.

The World Bank warned that unless Israel removed some of the physical and administrative obstacles to Palestinian travel and trade, donor countries asked to pledge $5.6 billion at a conference in Paris next week might be wasting their money.

Even if the donors provided the full amount, the Palestinian economy would keep shrinking about 2 percent a year as long as the Israeli restrictions remained in place, the World Bank wrote in a report yesterday.

Israel's military has been reluctant to remove some of the hundreds of roadblocks and barriers in the West Bank, saying that they are an effective tool against Palestinian extremists and that the Palestinian government does not have sufficient control over the territory to prevent attacks on Israelis.

The issue of roadblocks was raised yesterday in a meeting attended by international Mideast envoy Tony Blair, Palestinian Prime Minister Salam Fayyad, and Israeli Defense Minister Ehud Barak. Asked whether he had received any Israeli guarantees of easing restrictions, Fayyad said: "It's a one-word answer -

no.

"

However, Blair's presence made it clear that the international community had a "huge stake in all of this," Fayyad said. "Donors are being asked to fund the Palestinian Authority, whose funding needs are at least in part caused by these [Israeli] restrictions."

Israeli government spokesman Mark Regev said his country supported the donors' efforts and had an interest in seeing the Palestinian economy recover. Israel is willing to move on the issue of roadblocks, he said, but he gave no specifics.

Palestinian extremists fire crude rockets almost daily at southern Israeli border communities, but the inaccurate projectiles rarely cause casualties or damage. However, they disrupt daily life there, and Israel has indicated it will launch a large-scale ground attack in Gaza to try to stop the barrages.

The incoming U.N. Mideast envoy, Robert Serry, denounced the rocket attacks in unusually strong terms. "Let me be clear about this," he said. "We consider that to be terrorist acts."

Ahead of Monday's donor conference, Israel was coming under heavy pressure to show flexibility on the restrictions issue. British Prime Minister Gordon Brown has said he will link a $500 million aid package to improved security in the region, progress in peace talks, and an easing of Israeli restrictions.

In violence yesterday, a rocket fired by Gaza extremists hit a house in the Israeli border town of Sderot and seriously injured an Israeli woman. A few hours later, Israeli aircraft blew up a car in Gaza City, killing three extremists, Palestinians said. Israel said the target was a Palestinian cell that had fired rockets at Israel.