The two main Palestinian factions, Hamas and Fatah have agreed to form a coalition government. VOA's Jim Teeple reports from Jerusalem that Israeli officials say if a new Palestinian government meets international demands for the recognition of Israel, and ending violence, the Middle East peace process could be revitalized.
After months of fitful negotiations, Palestinian President Mahmoud Abbas of Fatah, and Palestinian Prime Minister Ismail Haniyeh of Hamas, agreed to set aside their differences and form a coalition government to rule the Palestinian territories.
Fatah and Hamas have been feuding, sometimes violently, for months - since Hamas won Palestinian parliamentary elections in January, ending the Fatah grip on power in the Palestinian territories. Saeb Erekat, a close associate of Mr. Abbas, says many of the details of the proposed new government still have to be worked out, but the agreement is a step forward.
"The most important thing now is what will be the outcome of the political program of this government," he said. "An agreement was reached in principle but there are many details to be ironed in the next coming days."
Erekat says any new government will have to agree on a common program. In the past, Mr. Abbas has said a coalition government would have to agree to a two-state solution and an end to violence against the state of Israel.
Israeli Foreign Ministry spokesman Mark Regev says the announcement will be viewed positively by Israel if the new government agrees to recognize Israel, stop violent attacks against Israelis, and help facilitate the release of an Israeli soldier being held by Palestinian militants.
"If all that was done that would be an important confidence-building measure that would reopen the door to dialogue between Israelis and Palestinians and create a momentum in the peace process," he said.
Hamas leaders say the agreement is based on the so-called "prisoners document", which among other things calls for a Palestinian state in the West Bank and Gaza Strip and negotiations with Israel. But one senior Hamas leader says the militant group would not recognize Israel as demanded by the international community.
The Hamas-led government in the Palestinian territories has been crippled financially by the suspension of donor aid from the international community and customs and tax revenue that Israel had been transferring to the Palestinian Authority before Hamas assumed power. Most Palestinian civil servants have not been paid in nearly six months, and many have been on strike for more than a week in protest against the Hamas government's inability to pay their salaries.