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"A Palestinian was killed by an Israeli tank shell near Erez," Adham Abu Selmiya told AFP, identifying him as 21 year old Mohammed Ziyad Shalha.
The incident was confirmed by the Israeli army, with a spokeswoman saying troops had fired on "an armed man".
Earlier, witnesses reported seeing Israeli troops firing at two men in the same area in what was understood to be the same incident.
At the time, Palestinian medics were not allowed into the area so were unable to confirm how many people were involved or how badly they had been hurt.