UNESCO approved a Palestinian bid for full membership Monday in a highly divisive breakthrough that will cost the agency a fifth of its budget, and that the U.S. and other opponents say could harm renewed Mideast peace efforts.

Soon after the vote, the United States cut funding to the organization because of a U.S. law that bars funding an organization that has the Palestinians as members before an Israeli-Palestinian peace deal is reached.

Canadian Foreign Affairs Minister John Baird said later Monday that Ottawa is reconsidering how much support it gives the United Nations Educational, Scientific and Cultural Organization as a result of the agency's action. Canada contributes about $10 million a year to the agency.

"We are not happy with the decision UNESCO has made, and we have to look and see what we should do in response," Baird said. "I think UNESCO does important work that our government can support, but we are not happy with this decision, so we are in the midst of looking at our future participation."

U.S. State Department spokeswoman Victoria Nuland said the UN cultural and educational agency's decision was "regrettable, premature and undermines our shared goal to a comprehensive, just and lasting peace" between Israelis and Palestinians.

She says the U.S. would refrain from making a $60-million US payment it planned to make in November. But Nuland said the U.S. would maintain membership in the body.

Monday's vote by UNESCO is a grand symbolic victory for the Palestinians, but it alone won't achieve statehood. The issues of borders for an eventual Palestinian state, security troubles and other disputes that have thwarted Middle East peace for decades remain unresolved.

The Palestinians want full membership in the UN, but Israel opposes the bid. The U.S. says it would veto a vote in the Security Council.

Delegates vote 107-14 to OK bid

Huge cheers went up in the United Nations Educational, Scientific and Cultural Organization after delegates approved the membership in a vote of 107-14 with 52 abstentions. Eighty-one votes were needed for approval in a hall with 173 UNESCO member delegations present. In a surprise, France voted yes, and the room erupted in cheers, while the no votes included the United States, Israel, Sweden, the Netherland and Germany.

"Long live Palestine!" someone shouted in the hall, in French, at the unusually tense and dramatic meeting of UNESCO's General Conference.

Even if the vote's impact isn't felt right away in the Mideast, it will be quickly felt at UNESCO, which protects historic heritage sites and works to improve world literacy, access to schooling for girls and cultural understanding, but it also has in the past been a forum for anti-Israel sentiment.

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Israeli Prime Minister Benjamin Netanyahu warned his government would "not sit quietly" after UNESCO approved a Palestinian bid for full membership. ((Jack Guez, Pool/Associated Press))

Existing U.S. law can bar Washington from funding any UN body that accepts members that do not have the "internationally recognized attributes of statehood." That requirement is generally interpreted to mean U.N. membership. But it remains unclear whether the U.S. State Department will try to find legal wiggle room.

Democrats and Republicans in Washington criticized the move.

U.S. Representative Ileana Ros-Lehtinen, chair of the House foreign affairs committee, said in a statement, "Today's reckless action by UNESCO is anti-Israel and anti-peace."

Aside from the U.S. funding cut, Israel's Foreign Ministry said it "will consider its further ... co-operation with the organization" after Monday's vote.

UNESCO depends heavily on U.S. funding — Washington provides 22 per cent of its budget — but has survived without it in the past: The United States pulled out of UNESCO under President Ronald Reagan, rejoining two decades later under President George W. Bush.

"Joy fills my heart. This is really an historic moment," said Palestinian Foreign Minister Riad Malki after UNESCO's decision. "We hope that today's victory at UNESCO marks but a beginning. Our admission to UNESCO is not an alternative, is no substitute for something else."

Abbas rival praises UNESCO decision

In the Gaza Strip, Abbas's rival, the militant Hamas government, also praised the UNESCO decision, saying that the confrontational approach by Hamas toward Israel was behind the vote.

"It also indicates that the Palestinian cause is getting more support while American policy is regressing," said Hamas official Salah Bardawil.

UNESCO, like other UN agencies, is a part of the world body but has separate membership procedures and can make its own decisions about which countries belong. Full UN membership is not required for membership in many of the UN agencies.

Monday's vote is definitive, and the membership formally takes effect when the Palestinians sign UNESCO's founding charter.

Israel's outspoken foreign minister, Avigdor Lieberman, said before the vote that if it passed, Israel should cut off ties with the Palestinian Authority. It was not clear whether he was voicing an individual opinion or government policy. He has a history of making comments embarrassing to the prime minister.

In an address to parliament, Israeli Prime Minister Benjamin Netanyahu harshly criticized the Palestinians' move.

"Unfortunately, the Palestinians continue to refuse to negotiate with us. Instead of sitting around the negotiating table, they have decided to form an alliance with Hamas and take unilateral steps at the UN, including today," Netanyahu said. He warned his government would "not sit quietly."