The group of international mediators - the United Nations, the United States, Russia and the European Union, reached the agreement at the UN headquarters on Tuesday.

The Quartet issued a statement after a day of talks in which Egypt, Jordan and Saudi Arabia warned of a civil war if the Hamas-led Palestinian Authority was left to collapse.

"The Quartet expressed its willingness to endorse a temporary international mechanism that is limited in scope and duration, operates with full transparency and accountability," it said.

The United States, which initially opposed a European proposal to channel aid to the Palestinians via an international mechanism such as the World Bank, said any such move would have to be limited in scope and mechanism so aid would not reach the Hamas-led Palestinian Authority.

Condoleezza Rice, the US secretary of state, told a news conference at the United Nations that "the thrust of the statement is that the international community is still trying to respond to the needs of the Palestinian people".

"It is to provide assistance to the Palestinian people so they do not suffer deprivation," she said.

No details yet

Kofi Annan, the UN secretary-general, said the international mechanism to be used should begin as soon as possible and be reviewed after three months.

The Quartet has urged Hamas to
recognise Israel's right to exist

The statement did not suggest precisely how much or what kind of aid would be provided.

But the agreement seemed to underscore a concern that months of withholding aid from the Palestinians, part of an effort to press the new Hamas-led government towards a more accommodating stance with Israel, was harming the Palestinian people.

The move also came after the World Bank warned on Monday that the Palestinian Authority could face a breakdown in law and order and basic services unless foreign donors paid the salaries of about 165,000 civil servants.

The European Union will take the lead in working out the details but has suggested in the past that the World Bank could be a suitable vehicle for getting aid to the Palestinians.

Hamas

The US, however, remained firm on Hamas, with Rice urging the world on Tuesday to keep a hardline against the government led by the Islamist group.

"Hamas has a choice to make. If it is going to govern and govern effectively, then it has to come into line"

Condoleezza Rice,
US secretary of state

"No one wants to have to deal with a Palestinian government that, when there is a suicide bombing in Tel Aviv, finds that reason to celebrate," Rice said.

"Hamas has a choice to make. If it is going to govern and govern effectively, then it has to come into line" with international demands to renounce violence, abide by previous Palestinian agreements and recognise Israel's right to exist, the American foreign minister added.

US aid

Rice also announced that the US would provide $10 million worth of medicine and medical equipment to the Palestinians.
   
US officials said $4 million worth of goods could be delivered as early as Wednesday and $6 million worth will be dispatched later via the United Nations Children's Fund.

The US and EU have cut off much of the aid that had flowed in the past to Palestinian programmes to prevent any of it from helping Hamas, which won elections in January.