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GAZA (Reuters) - Rival Palestinian factions Fatah and Hamas agreed on the make-up of a national unity government on Tuesday in the most significant step yet toward healing their seven-year rift.
The two groups said they had decided on a list of independent, technocrat ministers who will run the government pending elections in at least six months - moves they hope will revive institutions paralysed since the parties fought a brief civil war in 2007.
Officials from the two sides told a news conference in the Gaza Strip that Palestinian President Mahmoud Abbas will make a formal announcement of the new government later this week after choosing a religious affairs minister.
"The viewpoints of the Hamas and Fatah movements will be presented to President (Abbas) to give his final decision on the government line-up," Fatah official Azzam al-Ahmed said.
The deal cements an initial unity pledge the two parties announced on April 23, just as U.S.-backed peace talks Abbas was holding with Israel were collapsing.
Those negotiations now appear to be totally stalled, yet both Abbas and his Israeli counterparts say they seek more talks under the right conditions.
Israel objects to the reconciliation moves and regards Hamas, which refuses to recognise it or renounce arms, as a terrorist group.
The two factions agreed that current Prime Minister Rami Al-Hamdallah, a former university president picked by Abbas, will lead the new cabinet. Sources close to the unity talks said Hamdallah would also assume the sensitive post of interior minister, and that the current ministers of foreign affairs and finance will stay on.
They said a formal swearing-in ceremony will be held later in the week at Abbas's seat of government in Ramallah. Abbas has sought to soothe foreign donor countries upon which his government depends for its economic survival that he will remain the main Palestinian decision-maker on diplomacy and policy toward Israel.
Deep mistrust have scuppered previous deals to end the internal Palestinian rift, with both sides struggling to reconcile Hamas's commitment to fighting Israel with Abbas's choice to negotiate with it.
Ismail Haniyeh, current prime minister of the Hamas government in Gaza, said at a rally earlier on Tuesday that Palestinians would now be newly empowered to fight Israel.
"Palestinian reconciliation aims to unite the Palestinian people against the prime enemy, the Zionist enemy. It aims to pursue the choice of resistance and steadfastness," Haniyeh told supporters in the southern town of Rafah.
Sources close to the talks say reconciling the Hamas-built security services in Gaza with Abbas's Western-equipped security forces in the West Bank will be delayed until after elections.
Leaders of the group said their most powerful armed wing will remain untouched even after the vote.
Editing by Noah Browning and Crispian Balmer, Editing by Angus MacSwan