The "Quartet" of Middle East peace brokers have agreed on a plan to resume aid for Palestinians, frozen since the Hamas government took power.

The scheme aims to release more than 120m dollar of EU funds to support local health services and cater for the basic needs of poor Palestinians.

But funds will bypass the government, which refuses to recognize Israel.

Many Palestinians have been suffering severe economic hardship following the suspension of international aid.

The EU and US cut off funding after Hamas came to power earlier this year, accusing it of being a terrorist group.

But the aid freeze has prompted fears of a humanitarian crisis.