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Last Updated: Thursday, 15 March 2007, 12:13 GMT
Palestinian PM unveils unity team
Ismail Haniya shakes hands with Mahmoud Abbas
Haniya (L) hopes the deal will start a new chapter for Palestinians
Palestinian Prime Minister Ismail Haniya has unveiled a national unity cabinet after months of negotiations between his Hamas movement and Fatah.

The key posts of finance, interior and foreign ministers will go to men who are not members of Hamas or Fatah.

The list will be submitted to parliament on Saturday for approval.

Israeli officials have criticised the new government's platform which they say does not contradict Hamas's core principle of not recognising Israel.

US and European Union officials say they are waiting for the final outcome of the unity talks before deciding whether to lift economic sanctions imposed on the outgoing Hamas-led government.

Key tests

Israeli officials have made it clear they see the agreement as a step backwards, as it does not address their demands that the new government recognise Israel and sign up to past Israeli-Palestinian deals.

Palestinian fear and uncertainty over unity government

"It is difficult to see anything positive in this," an official told the BBC.

BBC Middle East analyst Roger Hardy says the unity deal has had a difficult birth and there is still deep mistrust between Hamas and Fatah, the two factions whose bitter rivalry brought the Palestinians to the brink of civil war.

"We hope that this government will mark the start of a new era and enable us to turn the page," Mr Haniya told journalists after handing the list to Palestinian Authority President Mahmoud Abbas, of the rival Fatah faction.

Mr Haniya said if the Palestinian parliament approved the cabinet list, as it is expected to do, the ministers could go straight to Mr Abbas to be sworn in so the government could start work.

I hope this will assure internal unity and peace and also provide the basis for successful negotiations with Israel
John Muller, US

The key position of interior minister is being given to an independent academic, Hani Kawasmi.

Analysts say the main test he faces will be over whether he can impose control over Hamas and Fatah military chiefs who currently exercise huge power and autonomy.

The test for the incoming finance minister, Salam Fayyad, will be to reverse a trend in which money has flowed to the Hamas-led government through unofficial channels, because of the international boycott.

Ismail Haniya announces the new cabinet

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