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Fatah and Hamas Agree to Palestinian Coalition Gov`t

The President of the Palestinian Authority (PA), Mahmoud Abbas of the more "moderate" Fatah movement on Monday afternoon confirmed with reporters the establishment of a coalition government with the ruling Hamas party, the aim being to ease the effect of international sanctions and help the ailing Palestinian economy. Both sides have been trying to form a coalition government for several months, without success. Abbas said to reporters, "The continuous efforts to form a national unity government have ended successfully with the announcement of a political program for this government."

Following the election of Hamas - labled a terrorist group by the U.S., Israel and E.U. - to a majority of seats in the Palestinian parliament in January, international funding dried up. It is expected by some of the more hopeful in the region that the coalition agreement will soften the anti-Israel stance of the Hamas-led government. Hamas has maintained that it will not recognize Israel, and in principle the group is committed to Israel`s destruction.

However, the agreement was reportedly based on a proposal that implies the recognition of Israel. The West, as well as Russia and China, have demanded that Hamas renounce violence, recognize Israel and accept existing peace agreements between the PA and Jerusalem. An attack from the Gaza Strip in late June on an Israeli armored personnel carrier resulted in several Israelis killed, the kidnapping of a soldier, and Israeli military action in Gaza. Terrorists from Hamas took part in the raid.