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Palestinians adjourn Cairo talks without government deal

CAIRO (Reuters) - Rival Palestinian groups adjourned their reconciliation talks in Egypt on Thursday with no deal on the shape or agenda of an interim government that would oversee the rebuilding of Gaza and prepare for elections.

An Egyptian official told the state-run Middle East News Agency they would hold another round next week. The success of the Egyptian-sponsored dialogue is seen as crucial after 21 months of schism between Hamas-ruled Gaza and the West Bank, where President Mahmoud Abbas’ Fatah holds sway.

Fatah and Hamas, the largest two Palestinian groups, differ fundamentally on how to deal with Israel. Hamas believes in armed struggle, though it is willing to consider a truce, while Abbas backs negotiations with the Jewish state.

The groups have agreed on the principle of forming a unity government and holding legislative and presidential elections by January 25, 2010.

Wasil Abou Youssef, secretary-general of the Palestinian Liberation Front, told Reuters that 10 days of talks had not proved enough for the participants to agree on whether the cabinet should include political groups or be made up entirely of non-partisan technocrats, as urged by Egypt and the West.

“There is no solution yet on the differences,” said Abou Youssef, whose group is part of the Fatah-dominated Palestine Liberation Organization (PLO) which has represented the Palestinians since 1964.

Amr El-Choubaki, an Egyptian political analyst, said failure to reach a deal on the government could be a “disaster” for the Palestinians. The rift turned bloody when Hamas kicked Fatah forces out of Gaza in June 2007.

“They could lose everything. Unless there is a government with some degree of national consensus and able to be a partner in peace talks ... the Palestinian cause could be headed toward its end,” he added.

The West shunned a previous unity government headed by Hamas after it won parliamentary elections in 2006. Many Arabs believe Western powers were punishing Palestinians for their democratic choice.

Israel, the United States and the European Union list Hamas as a terrorist group and refuse to deal with it. The Islamist group does not recognize the Jewish state.

Participants at the Cairo talks have said one sticking point was whether the new government would be committed to previous peace deals signed between Israel and the PLO.

Abou Youssef said the groups also could not agree on an electoral law. Delegates said over the past two days that all participants except Hamas were in favor of holding elections based on proportional representation.

Another participant said the groups were awaiting the return of Egyptian intelligence chief Omar Suleiman from an official visit to Washington before resuming the talks. He said delegates would consult with their leaderships and return “in a few days.”

Palestinian Prime Minister Salam Fayyad said this month he intended to resign by the end of March to pave the way for the formation of a unity cabinet. Abbas, who appointed Fayyad after Hamas routed Fatah in Gaza, asked him to remain in office until results emerged from the talks in Cairo.

The new government is also expected to lead efforts to reconstruct homes, public buildings, roads and other infrastructure in the Gaza Strip after Israel’s three-week military offensive, which ended in January.

Additional reporting by Mohammed Assadi in Ramallah; editing by Andrew Roche