Palestinian PM may bow out

Mr Haniya said he did not believe that Western donors would accept any administration he headed.

He fears they would also reject a Hamas government by Palestinian President Mahmud Abbas’ Fatah Party.

“The United States, the Europeans and others in the region have said that an agreement is a good thing but that they will not lift the siege without replacing prime minister Haniya,” he said referring to himself.

“If we have to choose between the siege and myself, we must lift the siege and end the suffering,” he said in a prayer sermon in a Gaza mosque.

Haniya denied that the formation of a national unity government was a “concession” by Hamas after it governed virtually alone since March.

The west has repeatedly called on Hamas to renounce violence and recognise Israel and past peace deals.

But Mr Haniya insisted that the Islamic militant group “would not abandon its people and the Palestinian cause.”

He expected agreement to be reached on the line up of a national unity government by the end of the month.

The development would follow four rounds of talks with Mr Abbas in Gaza this week.

“The dialogue has made progress, and my meetings with the president yielded results. We have laid the groundwork for forming a national unity government,” said Mr Haniya.

“We have reached agreement with the Palestinian groups, between Hamas and Fatah, in order to resume the talks next week. We hope to have good news within two or three weeks.”

Mustapha Barghuti, an independent MP who has been mediating between Abbas and Haniya, said late Thursday that the two leaders had agreed on who should lead the promised national unity government.

They have “solved all problems regarding the name of the prime minister.

This is no longer a problem,” Barghuti told reporters in the West Bank.

“The announcement of a new cabinet could take place within two weeks but the prime minister may be announced in the coming days,” he said.

Hamas spokesman Fawzi Barhum said the two sides were still not ready to announce the new prime minister designate.

“Hamas suggested a candidate. We still cannot talk about an agreement or not. The name will be announced at the right time,” he told AFP.

But Abbas’s spokesman too put an upbeat complexion on the talks, which had broken off for a month and a half before this week.

“The climate of discussions is very positive,” Nabil Abu Rudeina said.

“Contacts and discussions are continuing and I think we are in the final stage of negotiations to reach an agreement on the formation of a unity government.”

The moderate Palestinian Authority president held a rare telephone conversation Thursday with the Islamist movement’s supremo, Damascus-based exile Khaled Meshaal.

The European Union has been pressing for the national unity government to be formed as quickly as possible so that the aid freeze can be lifted.

Prime Minister Tony Blair said last week that Britain was “prepared to talk” to a unity government even if Hamas took part, provided it agreed to renounce violence, and recognise Israel and past peace deals.