GAZA CITY, Gaza Strip - The top Palestinian security official quit in exasperation yesterday after a second day of firefights among Palestinian factions left four people dead, including a truck driver delivering bread.

Residents frightened by two days of intense firefights holed up in their homes, leaving Gaza City's streets largely deserted while rival security forces took up positions on rooftops and hundreds of gunmen in black ski masks put up checkpoints and stopped cars.

The two-month-old Hamas-Fatah unity government struggled to prevent Gaza from again falling into chaos. Government spokesman Ghazi Hamad announced that a truce had been reached at a late-night meeting of rival factions summoned by Prime Minister Ismail Haniyeh. But a similar cease-fire the previous night collapsed within hours.

With eight dead and 70 wounded in fighting Sunday and yesterday, Interior Minister Hani Kawasmeh resigned and accused leaders on both sides of thwarting his efforts to halt the violence.

The career civil servant was a compromise candidate for the top security post when the Fatah movement and the Islamic radicals of Hamas formed a unity government in March after months of factional fighting. His resignation was a new blow to the shaky coalition.

Gazans found the latest violence more ominous than the previous round, saying it signaled the failure of the power-sharing deal between Hamas and Fatah.

"Now they are starting from where they left off," said Jamal Abu Shabaan, 21, who witnessed a gun battle outside his furniture store Sunday. "If they get to each other's throats, they won't let go this time."

Abu Shabaan said he had made up his mind after the last round of bloodshed to emigrate to Saudi Arabia and expected to leave in the coming days.

Universities were closed because of the violence, and many worried parents kept their children home from school.

"It's a curfew out there, masked men everywhere and kidnappings," said Shereen Abu Hassira, 36, who made her five school-age children stay inside.

Abu Hassira said her brother was snatched by Hamas gunmen Sunday night because he had been riding in a car with a Fatah-allied policeman. "No one cares for anyone anymore," she said. "If they thought of our children, they wouldn't have done this."

The Palestinian infighting, combined with a government crisis in Israel that is threatening to bring down Prime Minister Ehud Olmert, is hurting new efforts to bring Israelis and Palestinians back to the peace table after seven years of conflict.

At the center of the new Palestinian fighting is a dispute over who controls the security forces. A majority of the 80,000 security officers in the West Bank and Gaza are loyal to Palestinian Authority President Mahmoud Abbas, the Fatah leader, while Hamas set up its own 6,000-strong militia last year.

In forming their coalition, Hamas and Fatah put off dealing with the problem of security control. At the time, the two sides agreed on Kawasmeh as interior minister, ostensibly in charge of all security forces, but there was little expectation he would be given authority to integrate the rival forces under a joint command.

Two weeks ago, Kawasmeh threatened to resign, complaining his security plan had been ignored by both sides. Yesterday, he resubmitted his resignation, and the prime minister accepted it. Haniyeh said he would serve as interior minister until a replacement was named.

Olmert, Abdullah Plan Meeting Today

Israeli Prime Minister

Ehud Olmert and Jordan's King Abdullah II are to hold the highest-level dialogue yet on a sweeping Arab peace proposal at a meeting today in the ancient city

of Petra, Jordan.

A peace breakthrough would provide a welcome boost to the embattled Olmert, but new Gaza violence and the Israeli leader's domestic woes could make it difficult to move things forward.

The proposal offers Israel full recognition in exchange for a total withdrawal from lands it captured in the 1967 Middle East war and the creation of a Palestinian state. Israel has welcomed the plan as a good starting point for negotiations, but it objects to several key provisions.

The Arab peace plan was floated by Saudi Arabia

in 2002 and renewed in March at a meeting of

the Arab League. Israeli-Palestinian talks collapsed in 2000 after the outbreak of the Palestinian uprising against Israel. Subsequent efforts to restart peace talks have made little progress.

- Associated Press

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