Abbas on Thursday issued a presidential decree, dissolved the Hamas-Fatah coalition government and declared a state of emergency in West Bank and Gaza Strip, because of the deadly fighting between his Fatah party and rival Hamas.

The decree was read by Tayeb Abdel Rahim, secretary general of the Palestinian presidency, in a news conference held in West Bank city of Ramallah.

According to the decree, Prime Minister Ismail Haneya of Hamas is fired. Abbas is to install an emergency government in the place of the dissolved unity government and name an independent prime minister.

Abbas' statement also indicated that he could call for early elections once the situation in the Palestinian territories stabilizes.

"The president is determined to go back to the people as soon as the situation on the ground allows him to do so," Abdel Rahim said.

The next parliamentary elections are scheduled for 2010 and presidential elections are set for 2009.

Salah al-Bardaweel, a spokesman for Hamas, has rejected Abbas' decision as "hasty and conflicting."

Earlier, The executive committee of the Palestinian Liberation Organization (PLO) recommended President Abbas to break up the coalition government and declare emergency.

The coalition government was formed in March following a power-sharing agreement brokered by Saudi Arabia, in a bid to end months of Fatah-Hamas conflicts.