Published yesterday (updated) 29/04/2011 02:39, Maan -

EU foreign policy chief Catherine Ashton issued a statement Thursday saying she will follow with "great interest" the latest unity agreement between Fat'h and Hamas.

The statement came as Israeli and US officials said the deal could be the end of cooperation with the Palestinian Authority, while a UN official welcomed the move, calling it a necessary step toward negotiations.

"The EU has consistently called for peace and reconciliation, under the authority of President Abbas, leading to an end to the division between the West Bank and Gaza and in support of greater security and stability across the region," Ashton said in the statement, adding that EU officials will "study the detail of this agreement and discuss with colleagues in the EU and in the region."

Israel's official reaction, in comparison, was negative, with the country's Prime Minister Benjamin Netanyahu saying the PA should choose between peace with Israel, and Hamas.

Meanwhile Israeli President Shimon Peres said the move "as it stands, is a fatal mistake," citing fears, according to the Israeli daily newspaper Haaretz, that a future Palestinian election could lead to a "terror organization ruling both Gaza and Judea and Samaria [the West Bank and Jerusalem] and the triumph of Hamas' policies."

(If terrorism means killing civilians for political reasons, then the Israeli occupation government is a terrorist government for killing thousands of Palestinian and other Arab civilians in the past 63 years).

The official US government statement reiterated its stance that Hamas is a "terrorist organization." It also said that any Palestinian government would have to renounce violence, apparently opening the door for a new government body under specific conditions.

Several US congressmen, however, decried the unity move and immediately threatened to axe millions in funding for the Palestinian Authority.

US House Foreign Affairs Chairwoman Ileana Ros-Lehtinen released a statement that a "hybrid" government with Hamas would not qualify for US assistance because the party did not recognize the existence of Israel. Hamas leaders have said that recognition for the state would come when an agreement for a Palestinian state on the 1967 borders was reached.

Republican Senator from Illinois Mark Kirk echoed the sentiment on his Twitter page, writing "Hamas +Fat'h = probable suspension of US aid to Palestinian Authority...Hamas supports terror, killed 26 American citizens," while New York Democrat Nita Lowey said the moves put funding "at risk."

President Mahmoud Abbas went on record Thursday morning saying he believed the unity deal would help spur peace talks, and PLO officials have called on the international community to support the process.