updated 4/27/2009 12:36:45 PM ET 2009-04-27T16:36:45

Rival Palestinian factions Hamas and Fatah on Monday restarted their long deadlocked reconciliation talks in Cairo, incorporating new Egyptian ideas, said participants.

Nabil Shaath, a senior Fatah negotiator, said the Egyptian suggestion concerned the formation of the government and its political program. Talks broke down earlier this month mainly over the issue of the extent Hamas would abide by past Palestinian accords with Israel.

The two Palestinian factions have been at odds since the bloody power struggle in 2007 when Hamas seized the Gaza Strip, splitting Palestinian territories in two and leaving Fatah in control of the West Bank.

Ali Barakeh, a senior Hamas official in Damascus, said that Fatah's cooperation with the U.S. and submission to its ideas about the Middle East peace process were the main obstacle to a Palestinians reconciliation.

"If Fatah doesn't submit to ... U.S. pressure, we could within hours reach a comprehensive solution for all pending issues," he told The Associated Press.

Hamas' political leader Khaled Mashaal, who lives in exile in Syria, vowed Hamas would never recognize Israel and foreign countries' insistence on doing that had bogged down the talks.

Palestinian envoy to Cairo, Amr Nabil, however, said Hamas needed to be realistic because "without being in tune with the international situation ... we will not be able to rebuild Gaza or promote the efforts to establish a Palestinian state."

Cairo is also mediating on a second track between Israel and Hamas over a prisoner swap. Israel wants the return of Sgt. Gilad Schalit, captured in a cross-border raid in 2006. Hamas demands in return that 1,200 Palestinian prisoners be freed from Israeli jails.

Those negotiations also broke down in March. And with a new government now in place in Israel, hardline Prime Minister Benjamin Netanyahu, is unlikely to make concessions to Hamas.

The deadlock on both tracks will interfere with rebuilding Gaza, which was devastated in Israel's three week offensive that ended in January.

Gaza's borders have been virtually sealed since Hamas seized the territory by force in June 2007, and international aid groups have said reconstruction of the war damage is impossible without open borders.

Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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