The decision to set the date, after months of negotiations and violence between the rival parties, was made at a meeting between Abbas and Haniya on Wednesday.

The two leaders met to put the finishing touches to the coalition agreement and agree a compromise on the candidate for the powerful interior ministry, which has been a major point of contention.

Interior ministry candidates

"Several names were presented to the president. He will choose one and let Haniya know his choice this evening," Abu Rudeina said.

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They were eager to complete the talks ahead of an Arab Summit set for later this month in Saudi Arabia.

Fatah and Hamas agreed at a summit in Mecca in February to form a unity government after months of feuding that has left dozens of Palestinians dead.

Palestinians are hoping that the new coalition cabinet will lead to an end of a US and EU-led boycott on the government, which was introduced after Hamas assumed power last January and has severely damaged the Palestinian economy.

Under the terms of the power-sharing agreement reached in Saudi Arabia, Hamas will occupy nine cabinet seats, plus the premiership, and  Fatah will take six.
  
Hamas will nominate another three "independent" ministers and Fatah two.

The interior minister must be proposed by Hamas but approved by the president.