Israel accepted on Wednesday a decision by major Middle East peace brokers to resume some aid payments to the Palestinians - a move that could ease intense economic pressure on the Hamas-led government.
The Quartet of international mediators - the United States, Russia, European Union and the United Nations - agreed on Tuesday to create the new mechanism for funnelling funds to the Palestinians and will run it for a three-month trial period.
The Hamas-led government said it appreciated the Quartet's efforts to ease the burden on the Palestinian people but said they could have gone further, and in a statement criticised the fact that its own authority was likely to be bypassed.
"We were hoping that their decision could be more positive in dealing with the Palestinian government since it is an elected government that represents the Palestinian people."
The move follows fears expressed by some Quartet members that more pressure on the Hamas-led administration could cause the Palestinian government to collapse, unleashing a deeper humanitarian and security crisis in the West Bank and Gaza.
It was not clear how the mechanism - yet to be worked out but which the EU is expected to take the lead on - would function, but it was expected to effectively bypass the Hamas-dominated government and channel funds through the office of Palestinian Authority President Mahmoud Abbas instead.
The Authority relies hugely on foreign aid to pay public sector salaries and run health and welfare services. The monthly budget amounts to about $180 million, two-thirds of which has been paid from foreign aid and donations in the past.
Israel, which had pushed hard and successfully for financial assistance to the Palestinians to be severed after the Hamas-led administration took power in March, said the Quartet's move was acceptable as long as Hamas was sidelined.
"As far as we are concerned, the Quartet's decision to give further humanitarian support to the Palestinian Authority, bypassing the Hamas government, is definitely okay," Foreign Minister Tzipi Livni said on Army Radio.
Russia, the European Union and the United Nations had all put pressure on the United States, which has taken the toughest stand against Hamas, to agree to ease the boycott.
Once the mechanism is agreed, and that could take days or weeks, it is hoped some salaries to the Palestinian Authority's 165,000 employees, unpaid since March, will be settled.
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