Hundreds flee Hamas-run Gaza, Abbas forms new govt

GAZA, June 16 (Reuters) Hundreds of Palestinians fled Hamas-controlled Gaza by land and sea today to the West Bank where President Mahmoud Abbas prepared to swear in a new government that will bring an end to a US-led aid embargo.

''I will not live in a Hamas-run state,'' said Shadi, a fighter from Abbas's Fatah faction, after escaping Gaza for the occupied West Bank through an Israeli crossing point.

Abbas sacked the Hamas-led government after Islamist forces routed Fatah in the Gaza Strip and began imposing a new order.

The US consul-general who handles relations with the Palestinians said Washington would lift a ban on direct financial aid to the new emergency government, clearing the way for the European Union and Israel to follow suit.

''There won't be any obstacles economically and politically in terms of re-engaging with this government ... They will have full support,'' Jacob Walles told Reuters after meeting Abbas at his West Bank headquarters in Ramallah, near Jerusalem.

''We certainly want to be providing significant assistance again, for economic development and also to support the legitimate security forces,'' he said, condemning a Hamas ''coup''.

Gaza and the much larger West Bank are only about 45 km (30 miles) apart, with Israel in between, but they now appear poised to function as two separate territories.

''Gaza, unfortunately at this stage, is out of the control of the Palestinian Authority,'' Abbas aide Saeb Erekat said.

Hamas said it did not seek its own state in Gaza, where 1.5 million people live crowded along 40 km (25 miles) of coast.

Western powers imposed an aid embargo after Hamas came to power in March 2006 because it failed to recognise Israel, renounce violence and accept interim peace deals.

Hamas set up checkpoints in Gaza to prevent high-ranking Fatah officials from leaving the coastal enclave.

Palestinian officials said hundreds of Fatah supporters were allowed by Israel and Egypt to travel to the West Bank. But Israeli troops fired into the air to keep back dozens of Fatah activists trying to escape through the Erez Crossing.

WEST BANK TROUBLE About 50 Fatah gunmen and 200 other demonstrators stormed a Palestinian parliament building in Ramallah. The militants grabbed the deputy speaker, who is aligned with Hamas, and dragged him from the building, witnesses said. He was not hurt.

In Hebron, another West Bank city, militants of al Aqsa Martyrs Brigades, an offshoot of Fatah, stormed government offices and set up checkpoints to search for Hamas members.

Many Fatah supporters in Gaza fear reprisals from Hamas. In one refugee camp, Fatah loyalists lamented Hamas's takeover: ''We were destroyed... I feel lost,'' said Umm Rami, whose husband is a colonel in the Fatah-dominated National Security Forces.

Arab governments said they would support Abbas and called for a return to the situation before the past week of violence.

Abbas has picked Salam Fayyad, a Western-backed technocrat and formerly finance minister, to serve as prime minister of the emergency government in what Hamas said amounted to a coup.

The government will be sworn in today or tomorrow and will comprise 11 lawmakers, Abbas aides said.

Ismail Haniyeh, who became prime minister after Hamas won the 2006 parliamentary election, refuses to accept his dismissal.

In an interview with a French newspaper, he ruled out setting up a Palestinian state in the Gaza Strip: ''Separation is not on the agenda and never will be,'' Haniyeh said.

Palestinian lawmaker Hanan Ashrawi said Fayyad's cabinet faced daunting challenges ''to ensure the rule of law and to prevent the spread of lawlessness from Gaza to the West Bank''.

The security challenge was highlighted in orders issued by Palestinian police chief Kamal el-Sheikh, who is based in the West Bank, to his men in Gaza not to work or obey Hamas orders.

Haniyeh responded by appointing what he called a ''higher police command'' above el-Sheikh. Hamas also ordered a ban on gunmen wearing face masks to conceal their identities.

Under Palestinian law, Abbas can declare a state of emergency for up to 30 days. The state of emergency could be extended for another 30 days, but only after winning the approval of two thirds of parliament.

Hamas has a majority in the parliament although Israel's arrests of nearly half of Hamas's deputies put that majority in doubt and also made it hard to achieve a quorum. That could enable Abbas to keep the state of emergency in place longer.

REUTERS GT MIR RAI2120