Rival Palestinian factions Hamas and Fatah agreed that Fatah leader and President Mahmoud Abbas will head a transitional power-sharing government, removing a stumbling block in a push to patch a five-year-old feud. The accord, signed in Qatar by Mr. Abbas and Hamas chief Khaled Meshaal, ends haggling over the identity of the Palestinian premier, a dispute that had bogged down a nine-month-old unity agreement.
The step clouds prospects for the limping Palestinian peace talks with Israel, whose Prime Minister Benjamin Netanyahu objects to negotiating with a government that includes Hamas. Last year, Israel cut off transfer of tax and customs collected on the Palestinians' behalf to protest the unity agreement."Hamas is an enemy of peace. It's an Iranian-backed terror organization committed to Israel's destruction," Mr. Netanyahu said in a statement. "President Abbas, you can't have it both ways. It's either a pact with Hamas or peace with Israel."
The deal calls for Mr. Abbas to succeed Prime Minister Salam Fayyad, a respected economist who won the confidence of international donors by heading state-building projects that stressed financial transparency, infrastructure development and government overhauls.
Hamas had opposed the continued tenure of Mr. Fayyad, who was backed by Mr. Abbas, and demanded a prime minister from its base in the Gaza Strip. Mr. Fayyad, in a statement, welcomed the agreement.
The compromise reflects political weaknesses of both parties, said analysts. Hamas is adrift from its longtime base in Syria amid turmoil there, and Fatah is frustrated with the frozen U.S.-sponsored peace talks with Israel.
U.S. officials took a cautious view of a possible accord between the Palestinian factions, fearing the deal would impede an eventual peace agreement.
"We are not going to give a grade to this thing until we have a chance to talk to Palestinian Authority leaders about the implications," said State Department spokeswoman Victoria Nuland. Complicating any U.S. response is Washington's designation of Hamas as a terrorist organization.
U.S. "red lines" concerning Palestinian governance remain unchanged, Ms. Nuland said.
"Any Palestinian government must unambiguously and explicitly commit to nonviolence. It must recognize the state of Israel. And it must accept the previous agreements and obligations between the parties, including the road map" for Mideast peace, she said. "So those are our expectations."
Under the unity agreement, a power-sharing government is supposed to serve until elections can be held for president and parliament. The elections were supposed to be held in May; Palestinians say slow preparations make that date unlikely now.
Many Palestinians remain skeptical that a true reconciliation is at hand. The sides still have a sizable list of outstanding disputes before they can patch up the divide between Fatah in the West Bank and Hamas in the Gaza Strip.
Among those, the sides must agree on merging government bureaucracies, especially their parallel security forces, at a time when powerful figures in both parties, such as security chiefs, are reluctant to cede authority.
They must also appoint ministers in the interim government, agree on a mutual prisoner release, and integrate Hamas into the Fatah-dominated Palestine Liberation Organization.
A large majority of the Palestinian public supports reconciliation. Many Palestinians view the divide as the primary obstacle to statehood. The enduring rift hurt Palestinian efforts to seek admission as a member state to the United Nations last year.
Hanan Ashrawi, a senior official in the PLO, expressed hope the agreement would "give the reconciliation process the momentum to succeed."
A Hamas spokesman from Gaza said the group wants to remove all obstacles to reconciliation.
It is unclear if Mr. Fayyad will have a role in the interim government. The government is currently experiencing a budget crisis because of a shortfall of about $350 million in international donations.
That might stoke foreign dismay over the shift, said a Western diplomat. "I think they will be concerned over Fayyad's removal," the diplomat said. "They've hung a lot of credibility on Fayyad's state-building program."
