Hamas livid as Abbas reshuffles cabinet

Ramallah, West Bank: A new government in the West Bank was sworn in on Wednesday by Palestinian President Mahmoud Abbas in a ceremony in the West Bank town of Ramallah, in a move that has angered the Hamas government in Gaza.

Seven new ministers were sworn into the 14th Palestinian government, taking up portfolios covering health, tourism, national economy, justice, agriculture, transportation and telecommunications.

Local development minister Khalid Qawasme said the new cabinet will make the holding of local elections its "top priority" in another step that is expected to anger Hamas.

Meanwhile, Salam Fayyad lost his job as finance minister in the government reshuffle on Wednesday.

Although he is relinquishing the treasury portfolio, Fayyad will, however, retain his other post as prime minister following a shakeup prompted by a financial crisis in the West Bank-based Palestinian Authority and a deadlock over the implementation of a power-sharing deal with Hamas.

Nabeel Kassis, a former university president who like Fayyad is a political independent, took over as finance minister. He will have to deal with fiscal challenges posed by a steady decline in donor funds and by Israeli trade restrictions.

The Palestinian National Authority, which exercises limited self-rule in the occupied West Bank, is relying on foreign aid to cover a 2012 budget projected to reach $1.3 billion (Dh4.77 billion).

Making good on pledges

An International Monetary Fund report in March estimated a financing gap of about $500 million and urged donors to make good on pledges that allow the Palestinian National Authority to pay public worker salaries. Most of the aid comes from the European Union, the United States and Arab countries.

Amid the crisis, the Palestinian government has been serving in a caretaker capacity since resigning last February after Abbas signed a unity deal in Doha with Hamas and announced new elections would be held within months.

But the accord with Hamas, which seized Gaza from forces loyal to Abbas' Fatah movement in a brief civil war in 2007, ran into trouble over the composition of a unity government and is now effectively frozen.