Palestinian President Mahmoud Abbas on Wednesday congratulated the family of notorious Lebanese terrorist Samir Kuntar , who was freed on Wednesday with four Hezbollah guerillas as part of a prisoner exchange with Israel.

Abbas welcomed the swap between Israel and the Lebanon-based militant group, and in a statement congratulated the families of the "liberated prisoners," issued during a visit to Malta.

Kuntar has been imprisoned in Israel since 1979. He was convicted of one of the grisliest attacks in Israeli history - killing three people including, a man in front of his 4-year-old daughter, and then killing the girl herself by crushing her skull.

In Gaza, meanwhile, Hamas leader Ismail Haniyeh on Wednesday hailed Kuntar as "a great hero" and said Israel's decision to release him and four Hezbollah fighters had undermined Israel's policy of not freeing "prisoners with blood on their hands."

Haniyeh also branded the exchange of prisoners as "a victory" for Hezbollah and armed resistance against Israel.

"The Israelis should pay the price for the release of Gilad Shalit," Haniya said in a statement in central Gaza, referring to the Israel Defense Forces soldier kidnapped by Gaza militants in June, 2006 cross-border raid.

"It is hard to see thousands of prisoners still held in Israeli jails," He added.

People celebrated in the streets of the Hamas-controlled coastal territory, and handed out sweets in support of Hezbollah.

"Today is a great victory for the resistance movements and to Hezbollah, said Hamas spokesman Sami Abu Zuhri. "It shows that the only successful way to free the prisoners is by kidnapping soldiers."