| MECCA, Saudi Arabia
MECCA, Saudi Arabia Rival Palestinian factions signed a deal to form a unity government on Thursday, hoping to end bloodshed between their followers and to win back Western aid halted because of the hostility of Hamas to Israel.
Palestinian President Mahmoud Abbas, Hamas chief Khaled Meshaal and Hamas Prime Minister Ismail Haniyeh reached the agreement at crisis talks in Mecca after internecine fighting that has killed more than 90 Palestinians since December.
The agreement read out by Fatah official Nabil Amr made no mention of recognition of Israel. But a letter from Abbas, re-appointing Haniyeh as prime minister, said the new government should abide by "international law" and agreements signed by the Palestine Liberation Organization (PLO).
A Fatah official said there was concern on the Fatah side this would not be enough to end an aid blockade by Western countries. "We are afraid the Quartet will not accept this agreement and lift the siege," he said after the ceremony.
He was referring to a bloc consisting of the United States, European Union, United Nations and Russia which demands Hamas must renounce violence, recognize Israel and commit itself to existing peace accords before sanctions can be lifted.
Abbas had been seeking a clear statement that the new government would be "committed" to past accords, as a formula offering implicit recognition of Israel from Hamas.
A Hamas official appeared to suggest the movement was betting on a U.S. rejection but European and Arab support.
"I believe this agreement could be accepted by the European Union. We have had talks with European parties who say such an agreement could be accepted," Nasser Shaer, deputy prime minister in the outgoing government, said in Ramallah.
Asked if the deal met U.S. and Israeli demands, Shaer said: "With Israel? No. America has its own scenario ... we are betting on assistance from Arab countries. Saudi Arabia as well as other Arab states could help sell this agreement."
In the first international reaction, British Foreign Secretary Margaret Beckett called the agreement "interesting". "We will need to study these proposals carefully and discuss them with our European and other partners," she said in a statement.
Miri Eisin, a Israeli government spokeswoman, said: "Israel expects the new Palestinian government to accept and respect all three of the international community's principles, i.e., recognition of Israel, acceptance of all former treaties and a clear renunciation of all terror and violence."
Palestinian sources close to the Mecca talks said before the announcement that Hamas was ready to "respect" the accords with Israel if they "did not contradict Palestinian interests".
JOY IN GAZA
Palestinians welcomed the news. In Gaza, scene of the worst fighting, drivers honked horns and turned on sirens, gunmen fired rifles in the air and fireworks lit the sky.
"We have succeeded and we have started on a new path. We hope it continues ... for the sake of liberating our country," Abbas said in an address before King Abdullah of Saudi Arabia, a key U.S. ally which hosted the talks.
Haniyeh said the international sanctions would soon end. "This is the first step on the way to breaking the embargo on the Palestinian people under occupation," he said.
Israeli Prime Minister Ehud Olmert is scheduled to meet U.S. Secretary of State Condoleezza Rice and Abbas on February 19 in what has been billed as a bid to restart long-stalled peace talks.
But the meeting could be in doubt if Israel and the United States say the wording of the unity deal does not go far enough.
Officials says the two sides agreed on a distribution of cabinet posts with a Fatah deputy next to Haniyeh and key posts of finance, foreign affairs and interior going to independents.
Officials named former culture minister Ziad Abu Amr as foreign minister and Salam Fayyad as finance minister, a post he has held before. Hamas officials have tipped Hamouda Jerwan as interior minister, though Jerwan said he had not been informed.
Previous efforts to stem the bloodshed and find common political ground have resulted in short-lived ceasefires and a threat by Abbas to call a new parliamentary election, a move Hamas has said would be tantamount to a coup.
Meshaal vowed the united front would hold. "I promise you we will build the Palestinian house properly and unite our ranks," he said, addressing octogenarian ruler King Abdullah, who added in a short speech that he wished them success.
(Additional reporting by Lin Noueihed in Dubai, Wafa Amr in Ramallah, Nidal al-Mughrabi in Gaza, Dominic Evans in Jerusalem)