Fatah faces US cutoff if it joins Hamas government

JERUSALEM, Mar 13 (Reuters) The Bush administration intends to curtail contacts with President Mahmoud Abbas's Fatah faction if it joins a Palestinian government led by Islamic militant group Hamas, Western diplomatic sources said today.

The warning came as Fatah officials held talks in Gaza with Hamas, which beat long-dominant Fatah in January elections. Fatah has said it has no intention of joining the new government unless Hamas, whose charter calls for Israel's destruction, changes its political programme.

Diplomatic sources said strict U.S. restrictions on contacts and assistance to Hamas would apply to Fatah and other parties if they joined a government under the Islamic militant group.

Bush administration officials are barred from having direct contact with members of Hamas, and U.S. law prohibits the United States from providing any support to the group, classified as a terrorist organisation by the State Department.

''If Fatah joins as an organisation, it would fall into the same category,'' a diplomatic source said. ''Of course if Hamas and other government members accept the Quartet principles, that changes the situation.'' The Quartet of West A sia mediators comprises the United States, the European Union, the United Nations and Russia.

The United States and Israel are trying to isolate Hamas and pressure it into renouncing violence, abiding by interim peace deals and recognising the Jewish state.

Bringing Fatah, which is committed to seeking a negotiated peace with Israel, into the government could help Hamas avoid political turmoil at home and undercut efforts to marginalise the group internationally.

US WARNINGS US officials have told Abbas and other senior Fatah members in recent meetings that Washington opposes the faction joining the new government, Palestinian officials said.

''Hamas can't whitewash its cabinet (by bringing in Fatah and other factions),'' said a diplomatic source familiar with the deliberations. Under Palestinian law, Hamas has until the end of the month to form a government.

Curtailing contacts with Fatah could create a diplomatic vacuum since the United States and Israel have both vowed not to negotiate with Hamas. Hamas says talks with Israel would be a waste of time.

The United States has kept alive the possibility of renewing peace efforts by shunning a Hamas-led administration while holding direct talks with Abbas and other Fatah leaders.

Palestinian negotiator Saeb Erekat played down the possibility of Washington curtailing contacts with Fatah.

''The Americans know our position very well. We told them that there will be one policy for the Palestinian Authority, not two,'' Erekat said, apparently referring to PA chairman Abbas's calls for an end to violence and resumption of peace talks.

Hamas has so far flatly rejected calls by Abbas and the international community to recognise Israel and to respect previous Palestinian peace accords with the Jewish state.

Abbas said last week that the world should give the militant group a chance to moderate as it prepares to form a government.

REUTERS SB PM1857