Netanyahu says Abbas must abandon unity deal with Hamas

Palestinian President Mahmoud Abbas must abandon Fatah's pact with Hamas if he wants peace, Israel's Prime Minister Benjamin Netanyahu has told the BBC.

Israel earlier suspended peace talks with the Palestinians in response to a unity deal between the two factions.

The US has voiced its "disapproval", but is not ready to declare the talks over and is "still making the effort".

Fatah and Hamas agreed on Wednesday to form a unity government within weeks and hold elections six months later.

They have been at odds since Hamas, which won parliamentary elections in 2006, ousted forces loyal to Mr Abbas and Fatah in the Gaza Strip during clashes in 2007 and set up a rival government.

'No right to interfere'

Mr Netanyahu told the BBC's Middle East Editor Jeremy Bowen that Mr Abbas, the president of the Palestinian Authority and leader of Fatah, could "have peace with Israel or a pact with Hamas - he can't have both".

He said Israel would only resume peace talks with Palestinians "when they decide to abandon the course of terror".

"As long as I'm prime minister of Israel, I will never negotiate with a Palestinian government that is backed by Hamas terrorists that are calling for our liquidation," he added.

The chief Palestinian peace negotiator, Saeb Erekat, insisted that Palestinian reconciliation was an internal matter.

"Israel had no right to interfere in this issue," he told the Associated Press.

The prime minister of the Hamas-led government in Gaza, Ismail Haniya, meanwhile said he was not surprised by Mr Netanyahu's decision.

"The Israeli position was expected. This is occupation, and absolutely they do not want the Palestinian people to be united and want the division to continue," he explained.

Earlier, President Abbas said there was "no incompatibility between reconciliation and the talks" and that he was committed to peace on the basis of a two-state solution.

US Secretary of State John Kerry spoke to Mr Abbas on Thursday and told him of his "disapproval", but added that the US would remain committed to peace talks.

"We will never give up our hope or our commitment for the possibilities of peace" he said.

He added that both leaders would have to make compromises in order to find a way forward.

However, even before the latest announcements, no agreement had been reached on an extension to the negotiating period scheduled to end on Tuesday, reports the BBC's Yolande Knell in Jerusalem.

'Additional measures'

Israel, along with the US and the EU, considers Hamas a terrorist group.

In a statement released after a five-hour meeting of his security cabinet on Thursday, Mr Netanyahu called the reconciliation deal "a direct continuation of the Palestinian refusal to advance the negotiations".

He said Israel would take "a number of additional measures" in response to the Palestinians' "unilateral moves", but provided no further details.

Palestinians in Gaza City celebrated the announcement of the unity deal on Wednesday evening

Israel has already said it will deduct debt payments from tax revenues collected on behalf of the PA - which governs parts of the West Bank not under Israeli control - and limit its access to deposits in Israeli banks.

That move came after Mr Abbas applied to join 15 international treaties and conventions, which Israel said broke a commitment by the Palestinians not to. Mr Abbas took the step because Israel was refusing to release a fourth group of 26 long-term Palestinian prisoners. Israel had made such a release contingent on progress in the peace talks.

A senior US official said the White House would be forced to reconsider its assistance to the Palestinians if Hamas and Fatah formed an administration.

"Any Palestinian government must unambiguously and explicitly commit to non-violence, recognition of the state of Israel, and acceptance of previous agreements and obligations between the parties," the official told the Reuters news agency.