Rival Palestinian factions Fatah and Hamas agreed on the make-up of a national unity government yesterday in the most significant step yet toward healing their seven-year rift.

The two groups said they had decided on a list of independent, technocrat ministers who will run the government pending elections in at least six months, moves they hope will revive institutions paralysed since the parties fought a brief civil war in 2007.

Officials from the two sides told a news conference that Palestinian President Mahmoud Abbas will make a formal announcement of the new government later this week.

"The viewpoints of the Hamas and Fatah movements will be presented to President (Abbas) to give his final decision on the government line-up," Fatah official Azzam al-Ahmed said.