Reformist Palestinian Prime Minister Mahmud Abbas has run into trouble forming a new cabinet after three ministers loyal to Yasser Arafat refused to sign up, sparking a power struggle, which could delay key reforms. Israel, meanwhile, stepped up its war of words with Syria on Monday, warning Damascus that its belligerent attitude toward the Jewish state was "playing with fire".

Abbas, a moderate leader of Arafat's Fatah movement, the main faction in the Palestine Liberation Organisation (PLO), is trying to craft a reformist government and has another 10 days to present a line-up.

US President George W. Bush has promised to unveil the internationally drafted roadmap setting out the steps to Palestinian statehood by 2005 once the new government has been approved.

But Abbas, who enjoys sweeping international support for his calls for an end to anti-Israeli attacks by hardline groups, ran into a hitch late Sunday when three senior officials, known for their loyalty to Arafat, refused to join the new cabinet.

Abbas, also known as Abu Mazen, presented the initial draft proposal for a new cabinet to Arafat on Saturday night, but the veteran leader was said to be "not happy" with the line-up, which named his former Gaza security chief Mohammad Dahlan as head of internal security.

The three who are refusing to participate in the cabinet are chief negotiator Saeb Erakat, information minister Yasser Abed Rabbo and economy minister Maher al-Masri, Palestinian officials told AFP on condition of anonymity.

Their lack of cooperation could strengthen opposition from the old guard in Abbas' own Fatah faction, while their inclusion may present hurdles when he presents the proposals in parliament, where reformists want a government with more technocrats.

If Abbas fails to form a government within the time allotted, Arafat can by law ask a new prime minister to take over.

But Nabil Amr, a senior Fatah member and tough Arafat critic, warned "the world will not respect us if we continue (negotiating a cabinet) for too long".

Israeli Foreign Minister Silvan Shalom, in Turkey to discuss the regional situation after the US-British war on Iraq, urged the new cabinet to end 30 months of bloodletting.

Turning Sights on Syria

While a power struggle was underway in Ramallah, Israel turned its sights on long-time foe Syria, which has come under harsh criticism from Washington for allegedly sheltering members of the deposed Iraqi regime and possessing chemical weapons.

A top Israeli official warned Damascus not to "play with fire" after Syrian Foreign Minister Faruq al-Shara said the Jewish state would suffer if Syria was attacked by US forces who have taken over Iraq.

"Israel is not looking for an escalation with Syria but Damascus is playing with fire by threatening us with its terror arsenal," a senior official close to Prime Minister Ariel Sharon told AFP.

The Israeli official, who asked not to be named, said that at this stage Israel, which seized the Golan Heights from Syria in the 1967 Arab-Israeli war, was restricting itself to "supporting US efforts to stop Syrian support for terrorism".

Syria shelters leaders from several Palestinian resistance groups, including Hamas and Islamic Jihad, which are listed as terrorist organisations and which carry out human bombings in Israeli cities.

And Israeli Defence Minister Shaul Mofaz also said the Jewish state would brook no threat from Damascus.

US President George W. Bush sent tensions with Syria soaring on Sunday when he said he believed the country was holding banned chemical weapons.

Washington has also accused Syria of harboring Iraqi leaders who fled the US-led invasion, a charge Damascus has denied.

PHOTO CAPTION

Palestinian Mahmoud Abbas also known as Abu Mazen waves during The PLO's Central Council session to approve the idea of creating the position of a prime minister in the West Bank town of Ramallah in this Saturday March 8, 2003 file photo AP Photo/Nasser Nasser)