DAVOS, Switzerland - Senior Palestinian officials attending the World Economic Forum urged Israel and the world community to give Hamas a chance, suggesting they expected the militant group to change in the wake of its stunning election victory in the West Bank and Gaza.

"The international community should maintain (its) support of the Palestinian people if we are really seeking a prosperous region, a stable region, and would like to see a viable (Palestinian) state," Palestinian National Economy Minister Mazen Sinnukrot said Friday.

"The international community, especially from Europe, the States, Japan, the Arabs have been ... supporting our budget, supporting our infrastructure projects, our institutions," he said.

Sinnukrot and two other prominent Palestinians spoke at a news conference on the margins of the meeting of global business and political leaders in Davos, where they were asked to consider the extraordinary scenario of Hamas, as the party leading the Palestinian government, claiming credit for a suicide bombing.

"Let's not assume that they're going to be in the Cabinet and then go and bomb in Israel," said Mohammad Mustafa, a top adviser to Palestinian leader Mahmoud Abbas. "Let's not make that judgment."

Sinnukrot added that "even the PLO in the past was a terrorist prganization, and it sat with Israeli leaders, with international leaders. I think we have to give Hamas a chance, to see whether Hamas of yesterday will be the Hamas of tomorrow."

Afghanistan Foreign Minister Abdullah Abdullah said Hamas was in a situation where its actions would be heavily scrutinized.

"They have come into a position of responsibility and the world will expect them to act 100 times more responsibly than they have in the past," he told The AP. "How do they contribute to the peace and to the success of the roadmap and to the ... successful conclusion of the road map, two states living in peace with each other."

Sinokrot urged Israel to maintain its ties with the Palestinian Authority regardless - focusing especially on customs union and close economic ties established by the 1994 Paris agreement under which Israel collects some taxes on behalf of the Palestinians.

"Israel had been always our major trading partner. I'm sure that the Israelis, with their wise approach, will look at it in a very positive way - they will not try to tackle any incorrect issues when it comes to collection of revenues."

Mustafa said Abbas expected to work together with Hamas.

"There's nothing wrong with a parliament that has better representation (which) can only strengthen the system and strengthen the leadership. There will be more cooperation between Mr. Abbas and the new parliament."

Munib Masri, a leading Palestinian businessman, urged Israelis to accept the new reality.

"I hope our Israeli friends won't hide their faces behind their fingers. This is the situation, and we have to live with it together," he said. "I want to assure you that it will be OK. The Palestinians are resilient and they will do a good job, provided that everyone will give us a chance."

Egypt's PM says vote for Hamas was a demand for change Egyptian Prime Minister Ahmed Nazif said Friday night the overwhelming vote for Hamas was a demand for change by the Palestinian people who want jobs, services, and a better life.

British Foreign Secretary Jack Straw said Hamas now must demonstrate that "the transfer of power from elite to street" produces real democracy for the Palestinians.

Nazif and Straw spoke before an off-the-record dinner on Middle East issues at the World Economic Forum, a sellout event following Hamas' trouncing of the ruling Fatah party in Wednesday's legislative elections in the Palestinian territories.

Hamas, which has claimed responsibility for numerous suicide bombings in Israel and is considered a terrorist organization by the United States, is committed under its charter to the destruction of Israel. Israel said it will refuse to deal with any Palestinian government that includes Hamas.

The Egyptian minister spoke about the Hamas victory in a broader context, stressing that change is inevitable in the Middle East and "you can either let it happen or you can make it happen."

Some governments, which he did not name, are addressing the needs of their people, but others have not "and the need for change is then coming from the people - and that's what we are seeing around us today."

Throughout the Middle East, Nazif said, the top priorities of the people are jobs, better services and better living conditions and if governments fail to deliver, "political change becomes inevitable."

He said the question in the Palestinian elections is "are they not happy with their own situation only, or are they not happy with their own leadership? That's the question we need to answer."

Straw said he has lived by the results of democratic elections all his life and spent 18 years in opposition, so does agree with those who say the voters produced the wrong result and committed an injustice.

"It's when you get the so-called wrong answer that the faith of the elite and of the powerful in a democracy can really be tested," he said.

Already, he said, some people are saying the long-delayed elections should have been postponed further. But he disagreed.

"There is a problem now in the occupied territories and it is a problem for Hamas," Straw said.

"But the wrong answer leads straight back to Saddam Hussein, or it leads straight back to a Western-style coup d'etat to overturn the results of an election, then to military rule and decades of insurgency and bloodshed," he warned. "And a wrong answer approach, above all, leads to a loss of moral leadership, especially by the West."

Straw said the West must now ensure that the Palestinian elections provide "a wider lesson in democracy."

The first principle must be "that violence and democracy are incompatible."

The second principle is that those elected must deliver what they have promised the voters, and this can only be done "by peaceful, nonviolent means," he said.

Israel's right to exist is the third key principle, he said, and no Palestinian government "can in fact deliver for its own people without cooperation, without dealing with Israel."

"Many have been surprised by the result, but I suspect that none have been more surprised than the Hamas leadership themselves - for all indications were they were expected to do well, but they were praying hard to be in opposition where they'd be able to exercise negative power without responsibility," Straw said.

Now they have to face up to the fact that the responsibility of government in all democracies far exceeds the power, and Hamas' leaders "must be put on notice to meet their responsibilities," he said.

Arab League: Hamas must recognize Israel Hamas will have to accept the Beirut initiative, which calls for full Arab recognition of Israel, despite its declared stands, Arab League Secretary General Amr Moussa said Friday, following the Hamas victory in the Palestinian legislative elections.

Moussa added that the diplomatic process in the Middle East must follow the Beirut guidelines, which include a full Israeli withdrawal from the territories according to UN resolutions 242 and 338. The initiative, approved by the Arab League in 2002 was rejected by Prime Minister Ariel Sharon.

Moussa was speaking at a conference on the PA election results held during the World Economic Forum in Davos, Switzerland.

Finance Ministry Director General Yossi Bachar said at the same conference Friday that Israel may stop transferring funds to the Palestinians after Hamas won this week's election.

"We will face practical problems of how you deal with people that call for the destruction of Israel," Bachar said. "If they want to continue to work with us, they will have to find a solution, otherwise I can't see how they would get the money," he added.

Bachar said that the PA budget is based on customs and value-added tax revenue which Israel collects on behalf of the Palestinians and aid from Saudi Arabia.

World Bank special envoy James Wolfensohn, who coordinates between the PA and countries giving it financial aid, said Friday he believed the countries would terminate aid to the PA following Hamas' victory, due to the "lack of certainty and hope." He said the problem would present itself as early as next week when the PA will not have money to pay its employees' salaries.

Top Lebanese Shiite expects indirect Hamas-Israel talks Lebanon's most senior Shiite Muslim cleric said Friday he expects Hamas to negotiate indirectly with Israel following the militant group's sweeping victory in the Palestinian parliamentary elections.

Grand Ayatollah Mohammed Hussein Fadlallah also criticized the United States and Europe for taking the stand that Hamas could not form a Palestinian government unless it drops its aim of destroying Israel and renounces violence.

"We regard the rejection of the election results by America and Europe as a rejection of democracy and the Palestinian people's choice," said Fadlallah, who is the religious leader of Lebanon's 1.2 million Shiites.

Fadlallah praised Hamas' unexpected win Wednesday as a vote for the group's armed struggle against Israel.

"The Palestinian elections produced a political surprise: the Hamas movement winning an absolute majority in the Palestinian Legislative Council," Fadlallah told some 5,000 worshippers in a sermon after Friday prayers at a mosque in southern Beirut. "This indicates that the Palestinian people have elected the Islamic resistance to a position of political responsibility."

"Hamas will hold negotiations indirectly with the enemy to achieve liberation," Fadlallah said.

He did not suggest how the indirect talks could be conducted, but he said Israel could facilitate them by stopping its attacks on the Palestinians in the West Bank and Gaza Strip.

Negotiations cannot take place "while Israel is moving with all its destructive powers against the Palestinian people" as is the case now, Fadlallah said.

Later in the day, hundreds of Lebanese and Palestinian Hamas supporters drove through the streets of the southern city of Sidon in more than 100 cars to celebrate its election victory. They waved Hamas' green flags as well as pictures of Hamas leaders, mainly founder Sheik Ahmed Yassin, who was killed by Israel two years ago.

The cars were tailed by Lebanese police vehicles, and soldiers could be seen in the streets in case of any emergency. The march ended without any incidents.

"Hamas' victory is a victory for all the Palestinian people, and this will for sure strengthen the alternatives of resistance, liberating the land and the return of refugees," said Abu Ahmed al-Fadl, a Hamas official in southern Lebanon.

Hamas has been sending mixed messages about dealing with Israel in recent days, saying negotiations are not on the agenda but that an extension of last year's cease-fire is possible if Israel reciprocates.

Fadlallah attributed Hamas' win to its "proven sincerity in working to liberate the land and people by offering martyrs at the level of leadership and base." He was referring to the Hamas leaders who have been killed by Israel, often in airstrikes on their cars, as well as the more junior members slain in the conflict.

Fadlallah was the spiritual mentor of the militant Lebanese Hezbollah group during the 1980s, when the group was blamed for kidnapping Westerners and bombing American targets in Beirut that killed a total of more than 260 Americans.

However, Fadlallah has long since distanced himself from Hezbollah, which never admitted a role in the kidnappings and bombings.