Palestinian president Mahmoud Abbas's Fatah group has inked a deal with bitter rival Hamas to end their long-running feud and form an interim government ahead of elections this year, officials said today.
Israel said the accord, which was brokered in secrecy by Egypt, would not secure peace in the Middle East and urged Abbas to carry on shunning the Islamist movement, which has governed the Gaza Strip since 2007 after ousting Fatah in a civil war.
Forging Palestinian unity is regarded as crucial to reviving any prospect for an independent Palestinian state, but Western powers have always refused to deal with Hamas because of its refusal to recognise Israel and renounce violence.
"We have agreed to form a government composed of independent figures that would start preparing for presidential and parliamentary elections," said Azzam al-Ahmad, the head of Fatah's negotiating team in Cairo.
"Elections would be held in about eight months from now," he added.
Hamas won the last Palestinian legislative elections held in 2006 and a new ballot is months overdue. Israel is worried such a vote could hand Hamas control of the occupied West Bank, which is run by Abbas and his more secular supporters.
"The Palestinian Authority must choose either peace with Israel or peace with Hamas. There is no possibility for peace with both," Mr Netanyahu said in a televised statement.
The White House said Hamas was "a terrorist organisation" and added that any Palestinian government would have to renounce violence. A US official said it would also have to respect past peace deals and recognise Israel's right to exist.
In Cairo, Hamas spokesman Taher al-Noono said Israel was "not concerned with Palestinian reconciliation and has been an impediment to it in the past."
The surprise accord came against the backdrop of tumult across the Middle East and followed the ousting in February of Egypt's president Hosni Mubarak, who was a close ally of the United States and had no patience for Hamas.
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This agreement is possible because the Egyptian regime has changed. The new administration is taking a balanced position," said Hany al-Masri, a political commentator who took part in talks over the past two weeks that lead to the breakthrough.
Analysts said the ongoing uprising in Syria, where part of Hamas's leadership is based, had also put pressure on the group to try to end its isolation in Gaza, a tiny coastal enclave that borders both Israel and Egypt.
Ordinary Palestinians have repeatedly urged their leaders to resolve their deep divisions, but analysts thought differences on core issues such as security were too wide to bridge, with Hamas and the Palestinian Authority running separate forces.
Mahmoud al-Zahar, a senior Hamas leader who participated in the talks, said the deal covered five points, including combining security forces and forming a government made up of "nationalist figures".
He said Hamas and Fatah would free respective prisoners.
Implementation of the accord is due to start following an official signing ceremony in Cairo, expected in early May.
Any interim government is unlikely to include Hamas officials in an effort to avoid the sort of international boycott that hit the Palestinians after the 2006 election.
Mr Abbas is dependent on Western aid, which he has used to build up state institutions ahead of hoped-for independence.
Peace talks between Israel and Abbas broke down last year and the Palestinian president has been pushing instead to obtain backing in the United Nations this September for an independent nation on all the territory Israel occupied in a 1967 war.
Mr Netanyahu has criticised such a unilateral move and is expected to address a joint meeting of the US Congress during a visit to Washington next month where he plans to outline a plan to re-start the frozen negotiations.
While Fatah has supported the notion of a negotiated peace deal with Israel, Hamas has firmly rejected it and regularly fires missiles and mortars from Gaza into the Jewish state.
Some Palestinian analysts called for caution over news of the reconciliation deal.
"Previous experience has taught us not to rush into making a judgment," said analyst Hani Habib, who is based in Gaza.
"We have had experiences in the past where agreements were fully signed, not just by initial letters, where governments were formed and then everything collapsed," he added.
Reuters