A USA -sponsored draft resolution that for the first time would have condemned the militant Islamic group Hamas, which controls Gaza, failed to win the required two-thirds majority in the U.N. General Assembly.
The draft received 87 votes in favor, 57 against, 33 abstentions and 16 countries did not vote.
Haley told the assembly before the vote that it could make history and unconditionally speak out against Hamas, which she called "one of the most obvious and grotesque cases of terrorism in the world".
"I want to take a personal moment and ask my Arab brothers and sisters - is the hatred that strong?" she said. The people who have suffered by far the most because of Hamas are the Palestinian people. Isn't it time to let that go? "For true peace and security in the entire region, isn't it time for both sides to let this go?"
"The failure of the American venture at the United Nations represents a slap to the U.S. administration and confirmation of the legitimacy of the resistance", said Hamas spokesman Sami Abu Zahri.
Haaretz called the failure to pass the resolution a blow to the USA and Israel.
The Palestinians have severed ties with the Trump administration after the decision a year ago to move the USA embassy to Jerusalem and declare the city Israel's capital.
"She would like to go out with something", said a Security Council diplomat of the US -drafted resolution.
In an official statement, Hamas thanked United Nations member states "that stood by our people's resistance and the justice of their cause" and attacked Haley who it said "is known for her extremism and her positions that support the Zionist terrorism in Palestine".
"While it did not achieve a two-thirds majority, this is the first time that a majority of countries have voted against Hamas and I commend each of the 87 countries that took a principled stand against Hamas", he said.
"The question before us now is whether the United Nations thinks terrorism is acceptable if, and only if, it is directed against Israel", she told the assembly. Introducing the resolution, the US Ambassador to the UN, Nikki Haley, appealed for countries to put to one side their different views of the Israel-Palestine conflict and vote for the resolution.
The Palestinian Liberation Organization, meanwhile, celebrated the failure of the resolution, saying it proves that the world stands with Palestinians. The UN has passed "700 resolutions" condemning Israel because Israel breaks global law with its colonial policies and aggressive actions against the people of Palestine. "The victory will be in addition to the Palestinian right, no matter how long".
General Assembly resolutions aren't binding, so the vote has little practical effect.
"Haley criticized the United Nations for having an anti-Israel bias, pointing out that "over the years, the UN has voted to condemn Israel over 500 times".
"You should be ashamed of yourselves, wait until you have to deal with terrorism in your own countries", Israeli Ambassador Danny Danon told the chamber.
But after a procedural move by Kuwait and Bolivia, the body adopted a rule that meant the resolution needed a two-thirds majority to be adopted. She charged the Assembly with a double standard for using a simple majority for other resolutions.
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