RAMALLAH, West Bank, Jan 8 (Reuters) - Palestinian losses from Israel's Gaza offensive amount to a national catastrophe recalling the 1948-49 war in which the Jewish state was founded, Palestinian Prime Minister Salam Fayyad said on Thursday.

"What our people in Gaza are facing is a humanitarian catastrophe. It's a new Nakba, of a kind that has not happened since 1949," Fayyad told reporters in Ramallah.

Palestinians consider Israel's May 1948 declaration of independence their "Nakba", or catastrophe, citing the forced flight of hundreds of thousands of Arabs during the ensuing battles over what had been British-ruled Palestine.

Israel says its 13-day-old offensive, in which more than 660 Palestinians have been killed, is a response to cross-border rocket attacks by the Gaza Strip's Islamist Hamas rulers.

Fayyad is a leading figure in U.S.-sponsored efforts to advance peace talks and restructure the Palestinian Authority in the occupied West Bank. Hamas runs a separate administration with its own prime minister in the Gaza Strip.

Israelis bristle at "Nakba" commemorations, saying they cast doubt on the commitment of Palestinians to creating a state that coexists with Israel. Palestinians say they want Israel to recognise the suffering of refugees and demands for redress. (Reporting by Ali Sawafta; Editing by Alistair Lyon)

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