The so-called Middle East peace process Quartet, made up of the United Nations, the European Union, the United States and Russia, met on Monday in London to decide on a common response to the Hamas victory in the Palestinian elections last week. The group called on the extremist Muslims outfit to reject violence and recognize Israel or else risk losing the international aid  that keeps the Palestinian territories afloat. The joint statement, announced by UN Secretary General Kofi Annan said that "All members of the future Palestinian government must be committed to non-violence, recognition of Israel and acceptance of previous agreements and obligations, including the roadmap." Future aid would be reviewed in reference to these demands but no immediate steps to cut funding are planned.

However, Hamas has already rejected these demands as blackmail, saying it was up to Israel to change. "The Quartet should have demanded an end to occupation and aggression ... not demand that the victim should recognize the occupation and stand handcuffed in the face of aggression," came the uncompromising response from Hamas spokesman Sami Abu Zuhri.

Although Hamas appears set to defy the international demands, it is also attempting to assuage concerns over how any aid would be used, stating that it would only contribute to the daily needs of the Palestinian  people and not to attacking Israel. Senior Hamas leader Ismail Haniya said: "We assure you that all revenues will be spent on salaries, daily life and infrastructure. You can review this."

But the Israelis do not seem to be convinced. Government spokesman Mark Regev told Reuters on Tuesday that Israel expects to freeze the monthly customs and tax payments to the Palestinian Authority. The next payment of $40-50 million is due on Wednesday, Feb. 1, but the shock victory of Hamas in last week's elections prompted a review of the transfers. According to Regev, "pending final decision, it is most likely that automatic transfers will not continue."

The president of the Palestinian Authority, Mahmoud Abbas, urged international donors to continue funding to ensure "that the institutions continue to function and the plan to build our independent Palestinian state is not disrupted or derailed." The United States and the EU are the biggest donors to the Palestinian Authority, handing over more than €820 million a year. Hamas has said that it would try to source alternative funding in the Muslim world -- raising western fears that countries like Syria and Iran would enthusiastically jump into the breach. However, the fact that the Quartet did not immediately turn off the aid tap would seem to suggest that for all of Hamas' political rhetoric it will be their deeds rather than words  that will be sifted over by the international community over the coming days and weeks.

The German press on Tuesday assess the challenge that Europe and the West now face in having to deal with a Hamas-led Palestinian government.  

The left-wing Tageszeitung warns against any attempts to isolate a democratically-elected government, pointing to the worst case scenario of Algeria, when the failure to recognize the election of the Islamists led to a bloody civil war and the death of over 100,000 people. "The Europeans have learned from this disaster" and have drawn the conclusion that contact has to be maintained even with Islamists. "If Hamas is not to be isolated then the Europeans have to try to have a positive influence on its development." The paper warns against using aid as means of blackmailing Hamas. "The organization is in the midst of deep change, which could lead to the cessation of violence and the recognition of Israel." It comments a "European carrot would strengthen the pragmatic and moderate wing of Hamas, while the whip would only encourage the radicals."

The center-left Süddeutsche Zeitung looks at the implications of the Hamas win in terms of the rise of political Islam across the Middle East and argues for the movement to "be considered a rational political phenomenon rather than an irrational religious one." These organizations are dedicated to fighting despotism at home and what they see as the neo-colonial West. It would seem much more promising to attempt to integrate them, so that the democratic ideal is not abandoned, rather than demonizing them. "In doings so, at least the hope remains that the pragmatists among the Islamists will trump the ideologues."

According to conservative newspaper Die Welt one of the fundamental western beliefs is that when people are given the right to elect their own government they will always decide for democracy. However, the paper comments that the Palestinians have shook this belief. "Now Americans and Europeans have to realize that free elections do not necessarily lead to reason and that the wrong people can be elected." Nothing remains for the West but to recognize reality. "But that doesn't mean that the new government should be let off from its duties and international law."

The Financial Times Deutschland writes that the president of the Palestinian Authority Mahmoud Abbas is now almost the only remaining guarantee for the peace process. Yet the paper comments that is a pretty shaky basis on which to pin international hopes. Over the past few months Abbas "failed to keep the Palestinian fighters under control or to improve the security situation in the Gaza Strip following Israel's withdrawal." Following the defeat there has been frustration within his Fatah movement and clashes with Hamas supporters. The paper opines that although Abbas doesn't seem to have much authority or influence there are no other reliable partners. "Israel and its international partners can only hope that Abbas can stick to what he has promised: to stay in office and to work further for peace."

The center-right Frankurter Allgemeine Zeitung writes that "presumably Hamas will first and foremost follow its own power calculations when deciding between moderation and terror." It is clear that a Palestinian government that refuses to cooperate cannot expect any help from Germany, while one that is peaceful can expect German goodwill. The paper concludes that the "question is how can Berlin, the West and Israel contribute to the hoped for moderation?"

-- Siobhán Dowling
11.50 a.m. CET

A political storm that has been brewing since last September has finally blown up as cartoons depicting the Prophet Muhammad in a Danish newspaper provoke fury across the Muslim world.

The 12 cartoons were published on Sept. 30 in the Danish newspaper Jyllands-Posten and many Muslims deem them offensive -- after all, Islam bars any depiction of the prophet. These caricatures included depictions of Muhammad wearing a turban shaped as a bomb with a burning fuse, while in another he is wielding a sword. The newspaper caved into increased pressure on Monday and issued an apology stating, "These cartoons are not in violation of Danish law but have irrefutably offended many Muslims, and for that we apologize." (Though we're not printing the cartoons here, they've been plastered all over the blogosphere and you can find the caricatures and blogs discussing them via Technorati with the right keywords  .)

Danish Prime Minister Anders Fogh Rasmussen said he was delighted that the newspaper had apologized, although he maintained that he could not apologize himself, pointing out that freedom of the press means that the government is not responsible for what the press publishes.

However, these comments may be too little, too late to appease those Muslims whose fury against the cartoons is now being unleashed on all things Danish. Saudi Arabia has already recalled its ambassador to Denmark, while Libya said it was closing its embassy in Copenhagen. There have been calls for boycotts of Danish food -- products of the dairy company Arla Foods have already been pulled off the shelves in a handful of Arab countries including Saudi Arabia and its employees have reported being harrassed.

The Danish government has warned its citizens not to travel to Saudi Arabia and gunmen in the Palestinian-controlled Gaza Strip said any Scandinavians were at risk. The Danish Red Cross has pulled two employees out of Gaza, following threats from the al-Aqsa Martyrs Brigade. On Monday around 15 Palestinians with rifles and grenade launchers briefly occupied the EU headquarters in Gaza City demanding an apology, while others burned Danish and Norwegian flags. Norway also became a target after a newspaper there printed the same cartoons in January.

In a further escalation, an Iraqi militant group called on Monday for attacks against Danish and Norwegian targets. Denmark has around 530 troops serving in Iraq. According to the Danish army, on Monday a roadside bomb exploded near an Iraqi police car driving in front of a Danish patrol. But Danish army officials said that there was no reason to conclude that the attack was connected to the cartoon row.

The Financial Times Deutschland comments that the row has been simmering for months and the fact that it has exploded now is due to the growing tensions between Europe and radical Islam -- from Hamas to Iran's mullahs. "It also shows just how much the two sides live in completely different political worlds." The paper writes that the Danish government has nothing to apologize for, because it had no part in the decision to publish the cartoons. "Uncensored expression of opinion is a central pillar (and factor for success) of open societies." The paper argues that this includes the right to deliberate provocation and bad taste. The limits are set by the different national laws against libel, sedition or blasphemy. "One principle must now be mentioned," the paper concludes. "This is about freedom of opinion. Not in Libya -- in Europe."

The left-wing newspaper Tageszeitung is not quite so quick to jump to the defense of the Danish publication. It accuses the Jyllands-Posten of knowing exactly what it was getting itself into and of being the "mouthpiece for the right-wing reactionaries in Demark." The paper writes that the publication can look back to a tradition of anti-Semitism in the 1930s and that it now picks on immigrants, and Muslims in particular. The TAZ likens the cartoons to illustrations in the Nazi Stürmer newspaper and calls the decision to publish them a "calculated provocation." "Denmark has embarked on a clear xenophobic path over the past few years, which is evident not only in politics and law, but also in the public discourse." The TAZ comments that "one would have wished that the Muslim reaction was not quite so predictable." The debate seems to have turned into a kind of "Danish Rushdie Scandal" and an "unholy alliance of undemocratic regimes such as Iran, Libya and Saudi Arabia are using the opportunity to put Denmark under immense political and economic pressure."  This reaction leaves the western public with little choice but to defend press freedom. "Even when that is not easy in the face of these unappetizing caricatures."