Palestinian President Mahmoud Abbas said on Sunday night that the Palestinian National Authority (PNA) was in a serious financial crisis, shortly after Israel decided to halt monthly transfer of tax revenues.

"The Palestinian Authority has faced a serious financial crisis since the start of the month," Abbas told reporters at his Gaza office.

Israeli cabinet voted Sunday to suspend payment of monthly custom duties, estimated at 50 million dollars, one day after a Hamas-dominated Palestinian parliament was sworn in.

Abbas said that he would meet Hamas leaders on Monday to discuss forming the new cabinet.

Hamas spokesman Salah al-Bardaweil confirmed Sunday that the militant group had nominated its senior leader Ismael Haneya as prime minister, and Abbas is expected to ask Haneya to form the cabinet.

Hamas rejected Abbas'call for the expected Hamas-led government to respect existing agreements with Israel and pursue only peaceful struggle against the occupation in his speech at the swearing-in ceremony of the newly elected Palestinian Legislative Council on Saturday.

Mushi al-Masri, a Hamas spokesman, declared the 1993 Oslo peace accord between Israel and the Palestine Liberation Organization and the internationally backed roadmap plan for peace were dead, saying peace negotiation with Israel is not Hamas' strategic choice.

Israel, which brands Hamas as a terrorist group, refused to deal with Hamas-led Palestinian government if it doesn't renounce violence and recognize Israel' right to exist.

Hamas names Haneya PM

The Islamic Resistance Movement (Hamas) has officially chosen Ismail Haneya as the new prime minister of the Palestinian National Authority (PNA), a senior Hamas official said Sunday.

"Hamas has officially chosen Ismail Haneya for the Prime Minister post," Sallah al-Bardaweil, Hamas spokesman in the Palestinian Legislative Council (PLC), told reporters.

The nomination, which came one day after a Hamas-led Palestinian legislature was sworn in, was also announced to reporters in an MSM written text message.

Palestinian sources said Palestinian President Mahmoud Abbas will hold a meeting with a Hamas delegation Sunday afternoon in the West Bank city of Ramallah on the formation of a new Palestinian cabinet.

Abbas is also scheduled to meet later Sunday with Haneya and other Hamas leaders in Gaza to officially ask Haneya to form the new cabinet.

Under Palestinian law, Haneya has a maximum of five weeks to form the cabinet. If he fails to do so, Abbas will nominate another person to form the cabinet.

Hamas, which won the Jan. 25 Palestinian elections, said it is ready to form the cabinet and has held contacts with several political groups and individuals aimed at persuading them to join a national unity cabinet.

Haneya, a prominent Hamas leader based in Gaza, has been widely expected to head the next government.

Editor: Yan