Japan will resume direct aid to the Palestinian Authority after boycotting a previous Hamas-led government for more than a year, a Japanese official said on Monday.

"It's direct assistance ... amounting to about $20 million that will be paid in eight installments," Ryuji Iwasaki, press officer at the Japenese embassy in Israel, told Reuters.

Iwasaki said details of the package were still being discussed.

Japan had joined an international aid embargo on the Palestinian Authority after Hamas Islamists won parliamentary elections in 2006.

Palestinian President Mahmoud Abbas of Fatah dismissed the Hamas-led government and formed a cabinet led by Western-educated Salam Fayyad after the Islamic group seized control of the Gaza Strip in June.

The aid package was announced as Japanese Foreign Minister Taro Aso was visiting the region.

Fayyad's office said the money will mainly be used to support Abbas's government in the occupied West Bank and provide humanitarian aid to the Gaza Strip.