Rival Palestinian factions have agreed at crisis talks in Saudi Arabia to give key cabinet posts to independents, overcoming one stumbling block to a unity government, officials said yesterday.

They agreed on nominees for the finance and foreign affairs portfolios, according to sources from the Islamist group Hamas and Palestinian President Mahmoud Abbas' Fatah faction. The interior ministry will also go to an independent but the two sides have yet to agree on a candidate, they said.

A deal on a unity government could help end deadly fighting that has killed more than 90 Palestinians since December. It could also end an international blockade of Hamas.

Israel and the United States say Hamas must renounce violence, recognize Israel and commit to existing peace accords signed by the Palestinian Authority before sanctions can be lifted on any government including the Islamist movement.

A large part of the Mecca talks was therefore focused on agreeing a formula for the unity government's platform that would satisfy these demands.

Full commitment to the existing peace accords with Israel would also mean recognition of Israel, something Hamas has refused formally to do.

Palestinian sources close to the talks said Hamas was ready to "respect" the accords with Israel if they "did not contradict Palestinian interests", but Abbas was seeking a clear statement that it would be "committed" to them, to ensure sanctions end.

But Hamas spokesman Ghazi Hamad said in Mecca: "We will not recognize Israel."

Any agreement made by committees during the day would need to be approved by Abbas, Hamas chief Khaled Meshaal and Hamas Prime Minister Ismail Haniyeh, who were due to meet in the evening. A final deal could come then or today.

The deal on cabinet portfolios will see former Culture Minister Ziad Abu Amr nominated as foreign minister and Salam Fayyad as finance minister, a post he has held before.

Hamas and Fatah officials confirmed the names. Hamas is expected to suggest a neutral figure for the interior post. All three portfolios have been in Hamas hands since it won elections last year.

Under the deal, Fatah would take five minor cabinet portfolios and Hamas would take eight including economy, labour and justice.

An official at the talks said Abbas and Meshaal were tackling the issue of whether Haniyeh would remain as prime minister. If so, Fatah would insist on a Fatah deputy prime minister.

Source: China Daily/Agencies