Official sources at Palestinian President Mahmoud Abbas' Gaza headquarters revealed that Abbas, who arrived in Gaza on Thursday, held a meeting with Prime Minister Ismail Haneya aimed at putting the final touches on the formation of the expected national unity government.

The sources said that Abbas and Haneya agreed to hold more meetings in the coming days, and Abbas would stay in Gaza to hammer out an agreement on forming the new government.

"They discussed the results of the dialogues held between Fatah and Hamas movements last week in Gaza on the formation of the government and the delivery of the portfolios to those who would join it," said the sources.

The Hamas-led government insists that the a new national unity government should be formed only after Abbas obtains guarantees that the siege imposed on Palestinians would be lifted.
 
Palestinian Deputy Prime Minister and Minister of High Education Nasser el-Dein al-Sha'er had earlier said that President Abbas had received oral guarantees from several Arab countries that the siege imposed on the Palestinians would be lifted.

Other sources denied that Haneya and Abbas had failed to reach a consensus on the national unity government, adding that they agreed to resume their talks in Gaza on Saturday.

Both Hamas and Fatah agreed on replacing the Hamas-led government with a broader unity one to get the Palestinian territory out of its current economic and political quagmire. Progress has been made on the issue and some Palestinian officials expect the new government to be announced by the end of November.

Meanwhile, the Israeli government dismissed a new Middle East peace initiative proposed by Spain, France and Italy which called for an international conference, saying what it wanted only direct negotiation with relevant parties.

"The new initiative was most likely a Spanish idea un-coordinated with the EU or Israel," a Foreign Ministry spokeswoman told Xinhua. "Israel's policy is based on direct communication between all the parties involved."

Spanish Prime Minister Jose Luis Rodriguez Zapatero announced the initiative at a summit in Spain with French President Jacques Chirac. He outlined that the plan would be presented to an EU summit next month and his hope of winning the backing of Britain and Germany as well.
 
The initiative called for an immediate cessation of all forms of violence at both sides and for a prisoner exchange. It also urged the holding of an international peace conference.

Besides, it called for the formation of a national unity government by the Palestinians and an international mission in Gaza to monitor a cease-fire. In response, the Palestinian National Authority (PNA) expressed its welcome to the conference.

(Xinhua News Agency November 17, 2006)