Palestinian Prime Minister Ismail Haneya said on Friday that his Hamas-led government would not make concession in face of aid cuts.

Haneya also told a mass rally in Gaza City that the suspension of western aid would not bring down the Hamas cabinet or the Palestinian people, vowing no backdown.

He said that the Palestinian people chose the government they wanted in the January elections, which Hamas won by a landslide,adding that the people would not give in to western pressure.

The Hamas prime minister also said that his government would serve its full term of four years, slamming statements by some "who claim the Hamas government will last just one or two months."

Haneya made the statements as the United States and the European union decided to cut crucial aid to the new Palestinian government led by Hamas, which took office on March 29.

Meanwhile, Israel also halted the monthly transfer of about 50 million U.S. dollars of tax revenues it collects on behalf of the Palestinians to the Hamas government.

Haneya has said that the Palestinian treasury is empty and thatthe Hamas government is facing a severe financial crisis.

The United States and the European Union have demanded Hamas torenounce violence, recognize Israel's right to exist and accept interim peace deals.

But Hamas, or the Islamic Resistance Movement, rejected thedemands.

In order to overcome the financial difficulties, Hamas has been seeking support from Arab and Islamic countries.

Palestinian Foreign Minister Mahmoud al-Zahar kicked off a trip to Arab nations on Friday in a bid to secure political support and much needed aid to the cash-strapped Hamas government.

The two-week tour will bring him to Egypt, Jordan, Syria, Saudi Arabia, Kuwait and Bahrain.