In new bloodshed, an 18-month-old boy was killed by Israeli gunfire as he played outside his home in a Gaza refugee camp, and two Hamas militants died, one of them in an unexplained explosion in the West Bank, witnesses said.

An internal memorandum obtained by Reuters said Abbas authorized cabinet minister Mohammed Dahlan, who has clashed with Arafat in the past, to restructure the Palestinian Authority's Interior Ministry.

The decision makes Dahlan de facto interior minister with greater control over Palestinian security services intended to rein in militant groups under a U.S.-led 'road map' to Middle East peace, Palestinian officials said.

On Tuesday night, Abbas proposed giving Dahlan the Interior Ministry outright, but Arafat, who is Palestinian president, rejected the idea, an official said.

Abbas has held the portfolio since he took office on April 30, while Dahlan had a lesser job as minister responsible for internal security. Dahlan now gets control of the ministry without the official title.

'Dahlan is now carrying out the missions of a minister of the interior. He is in complete control over security agencies,' a Palestinian official said.

Secretary of State Colin Powell is due to visit the region on Saturday to promote the road map backed by the United States, Russia, the European Union and the United Nations.

ARAFAT HAD RESISTED DAHLAN APPOINTMENT

Among obstacles facing Dahlan are the rise of Palestinian militant groups in a 31-month-old uprising for independence and a crippling Israeli blockade on the West Bank and Gaza Strip.

Israel tightened travel restrictions on Palestinians as it celebrated its 55th Independence Day on Tuesday and Wednesday.

For weeks, Arafat had resisted a senior role for Dahlan, a former security chief from Gaza sacked by the president last year after speaking out against Palestinian Authority corruption and its handling of the uprising.

But Arafat relented under international pressure to let Abbas appoint reformist ministers to his cabinet, a key step in the road map toward establishing a Palestinian state by 2005.

Arafat still holds control of various security and intelligence bodies, which could complicate reform efforts.

In Gaza, Palestinian witnesses said soldiers guarding a Jewish settlement opened fire on the nearby Palestinian refugee camp of Khan Younis, shooting a baby in the head as he played in the sand. The army said troops in the area returned fire from Palestinian gunmen but had no information on the death.

The Islamic group Hamas said one of its gunmen was shot dead by Israeli troops as he reconnoitred near Beit Hanoun along the northeastern Gaza border. The army did not immediately comment.

A Hamas military commander was killed near the West Bank city of Nablus in an explosion in his apartment which fellow militants blamed on Israel. An Israeli military source denied the army was responsible. Dozens of Palestinians have died when bombs they were preparing exploded prematurely. Hamas, Islamic Jihad and other militant groups are halting activities at their offices in Syria, a Palestinian source said in Beirut, following U.S. pressure on Syria to rein them in.

(China Daily May 8, 2003)