Palestinian Prime Minister Ahmad Quraya has refused to retract his resignation in a meeting with veteran leader Yasir Arafat but will remain in his post for the time being, ministers said.

"There has been no breakthrough. Abu Alaa (Quraya) has not changed his position about resigning from yesterday," Minister Qadura Faris said after Quraya and his cabinet met Arafat at his leadership compound in Rama Allah on Tuesday.

"Abu Alaa is prepared to continue in his position for the time being but only until the formation of a new government," he said.

Quraya submitted his resignation on Saturday after a breakdown in law and order in Gaza, including an unprecedented spate of kidnappings. Arafat has refused to accept it, but Quraya announced after a cabinet meeting on Monday his resignation was still "effective."

Declined

Telecommunications Minister Azzam al-Ahmad also said Arafat had again declined to accept the resignation at Tuesday's meeting.

"President Arafat is continuing to refuse to accept the resignation and Quraya agreed to continue in his job for the moment," he said.

"At today's meeting, President Arafat repeated his refusal to accept Abu Alaa's resignation and he renewed his confidence in him," he told reporters.

"The resignation of Abu Alaa has been officially refused and he will remain in his place and the issue is finished."

Asked if there would be changes in the cabinet, Abu Rudaina said Quraya "has every right to make any changes or additions to his cabinet."

"President Arafat will not oppose any changes," he added.

Quraya left the meeting by a side door without making any comment to reporters while Arafat did not emerge from the building.