DOHA/TRIPOLI: A group of Western powers and Arab states Wednesday called for the first time for Muammar Gaddafi to step aside, but NATO countries squabbled publicly over stepping up airstrikes to help topple him. In a victory for Britain and France, which are leading the air campaign in Libya and pushed for an unequivocal call for regime change, the “contact group” of some 16 European and Arab nations, plus the United Nations, the Arab League and the African Union, said Gaddafi must go. “Gaddafi and his regime has lost all legitimacy and he must leave power allowing the Libyan people to determine their future,” a final statement obtained by Reuters said. It also said the rebels' national council, “in contrast with the current regime ... is a legitimate interlocutor, representing the aspirations of the Libyan people”. The wording was much tougher than at a previous conference two weeks ago and gave stronger backing to insurgents fighting to end Gaddafi's 41-year rule. Participants said they would work to create a financial mechanism to help rebels run the eastern region they control. Qatari Prime Minister Sheikh Hamad Bin Jassim Al-Thani told reporters material support could include “all the other needs, including defense equipment”. Qatar is a leading Arab supporter of the uprising which broke out a month ago in Libya, inspired by popular revolts that toppled the leaders of neighboring Tunisia and Egypt. At Ajdabiyah on the eastern front, rebels said they were exchanging rocket fire with Gaddafi's forces from a point about 40 km east of the long-contested oil port of Brega. They also reported a NATO airstrike on Gaddafi forces north of the town. Rebels reported more heavy fighting in Misrata, and said they were making progress against forces besieging the city, pushing them back 10 km in one area. Libyan television said NATO planes had bombed Misrata's main Tripoli street, scene of repeated battles between rebel defenders and government troops. It said people were killed, without giving details. The television also said alliance planes had attacked Gaddafi's birthplace of Sirte, east of Misrata. While there was agreement in Doha on the principle of removing Gaddafi, there were divisions over how to proceed. Britain and France, western Europe's two main military powers, are delivering most of the airstrikes on Gaddafi's armor, with other NATO states playing a smaller role. There is increasing frustration in Paris and London that airstrikes have neither tipped the balance of the war in favor of the rebels nor ended devastating shelling of Misrata. NATO's high-flying aircraft are running out of targets they can hit without endangering civilians, experts say.