JERUSALEM (AFP) – A decision by major world powers to keep in place a controversial aid boycott on the new Palestinian unity cabinet led by radical Hamas satisfied Israel but left Palestinians in dismay on Thursday.

The Middle East Quartet — the European Union, Russia, the United Nations and the United States — reaffirmed on Wednesday that the new coalition must renounce violence, recognise Israel and accept past peace deals.

Until then, the Quartet would maintain an embargo on direct aid to the Palestinian government, imposed a year ago when Hamas — considered a terror group in the West — formed a cabinet alone after winning parliamentary polls.

“We cannot be but happy that the international community does not accept the programme of the Palestinian government and continues to demand acceptance of the three conditions that it imposed,” Israeli government spokeswoman Miri Eisin told AFP.

While keeping in place the aid embargo, the Quartet said the new Palestinian leadership would not be judged solely on its “composition and platform, but also its actions”.

That was an apparent gesture to moderates in a cabinet that united the Islamist movement Hamas with Western-backed independents and moderate president Mahmud Abbas’s Fatah party.

In the West Bank city of Ramallah, a spokesman for Abbas, Nabil Abu Rudeina, told AFP the Quartet statement “reflects an evolution of its positions, but this remains insufficient.”

“We have to work immediately toward the application of the roadmap and the Arab peace initiative,” he said.

He was referring to the Quartet peace initiative that calls for an independent and viable Palestinian state alongside a secure Israel and an Arab initiative that called for full normalisation of relations with the Jewish state in return for it withdrawing from all occupied Arab land.

The Palestinians formed the unity cabinet hoping to put an end to months of deadly clashes between rivals Fatah and Hamas and to end the year-long aid boycott, which has sent the Palestinian economy crashing.

Clashes broke out again on Thursday in Gaza City after a Fatah activist was killed in unclear circumstances, Palestinian security sources said.

The new cabinet has stopped short of agreeing to the three Western conditions.

In unveiling its political programme on Saturday, prime minister Ismail Haniya of Hamas said it would “respect” past peace accords, but said the Palestinians had a “legitimate right” to “resistance in all its forms.”

Up to now Norway has been the only Western nation to recognise the new cabinet, earning a snub from Israel which has refused to deal with a government whose main group refuses to recognise its right to exist.

But Western powers, including Israel’s main ally Washington, have reached out to non-Hamas members of the new government, which includes US-educated moderates widely respected among donor nations.

The US consul general in Jerusalem, along with US and EU Middle East envoys, have met with Palestinian finance minister Salam Fayyad; several European countries have invited him and foreign minister Ziad Abu Amr, also an independent, to visit.

The Quartet statement came ahead of a planned visit to the Middle East by US Secretary of State Condoleezza Rice and UN Secretary General Ban Ki-moon.

US officials have left open the possibility that Rice — who will hold separate talks with Abbas and Israeli Prime Minister Ehud Olmert — will also meet with non-Hamas ministers of the Palestinian government.