* PM says German occupation memorial seeks unify nation
* Jews fear it distracts Hungarians from Holocaust role
* Hungary faces April elections, far-right in the running
By Marton Dunai
BUDAPEST, Jan 22 (Reuters) - Prime Minister Viktor Orban defended on Wednesday a planned monument to victims of Hungary's 1944 occupation by the Nazis despite objections by Jewish leaders who say it distracts from the nation's role in the Holocaust.
Orban wrote to Jewish leaders about the 70th anniversary plans, saying he was sure they could work together "to promote mutual respect and understanding and cooperation among our nation's communities."
"The memorial that honours the victims of the German occupation is one step in that direction," he said. Hungary is planning a 7 metre (23 ft) high statue commemorating all victims of the Nazi occupation on March 19, 1944.
Hitler's forces occupied Hungary after finding that their former World War Two ally was in secret peace talks with Washington and London.
Jewish leaders threatened on Tuesday to boycott events marking a parallel 70th anniversary of the Holocaust, unless plans for the statue were scrapped. They say the monument risks blurring Jews' suffering at the hands of Hungarians with the suffering of Hungarian civilians during the war.
Anti-Semitism has been a problem in Hungary, which has struggled to come to terms with a wartime role in deporting Jews to Nazi death camps. The government has declared a policy of zero tolerance against anti-Semitism.
The monument depicts the Archangel Gabriel, a symbol of Hungary, being defeated by an eagle symbolising Germany, and will stand in a central Budapest square. After the Nazi defeat, Hungary was occupied by the Soviet Union in 1945.
In Hungary the Holocaust began years before the arrival of German soldiers, with pogroms, mass killings, deportations and forced labour camps. Germany then got ready help from the Hungarian authorities in deporting 437,000 Jews in 1944.
Up to 100,000 Hungarian civilians, not counting Jews, died during World War Two, many during the German occupation, when the Russian front also crossed Hungary, historians say.
"The losses were horrific," Orban said. "I doubt that our nod to the memory of the victims needs any explanation. It's a matter of humanity, not political views."
Hungary's government has acknowledged that the authorities were partly responsible for the Holocaust.
But historian Laszlo Karsai said that Hungarians did not get the full truth. "People like to hear the lie that Hungary, the Hungarian people, were always innocent," he said.
Hungary holds elections in April, in which Orban's centre-right Fidesz party is a runaway favourite, polls show. One of its rivals is the far-right Jobbik party, which has vilified Jews and Israel and got 17 percent of the vote in 2010. (Reporting by Marton Dunai, editing by Alister Doyle)