Sharon edging to deal on coalition

JERUSALEM - Israel's Prime Minister-elect, Ariel Sharon, appeared close to forming a Government yesterday, while an upsurge of violence in the West Bank and Gaza provided an ominous reminder of the challenges ahead.

Political officials said Sharon and outgoing Prime Minister Ehud Barak had agreed on most elements of a joint platform for a unity government between Sharon's hawkish Likud party and the centre-left Labour Party.

The agreement, which is still to be finalised and needs the approval of both parties, appeared to boost Sharon's chances of establishing a stable coalition with Labour that would be receptive to peacemaking with the Palestinians.

Violence that has escalated since 72-year-old Sharon's election last week erupted into a full-fledged gun battle in southern Gaza yesterday in which Palestinian hospital officials reported two people dead and at least 40 wounded by bullets and shrapnel.

A branch of Palestinian leader Yasser Arafat's Fatah faction threw down the gauntlet to Sharon with a vow to step up attacks on Jewish settlers to scupper the former general's pledge to quash a revolt that has raged for almost five months.

Sharon has offered the Defence Ministry portfolio to Barak despite his promise to resign from public life after his crushing defeat.

Nobel laureate Shimon Peres is thought to be a frontrunner for Foreign Minister.

Labour parliamentarian Dalia Itzik said a coalition deal was not yet in the bag, despite the breakthrough in negotiations.

- REUTERS

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