Palestinian Authority President Mahmoud Abbas on Saturday asked his prime minister, Salaam Fayad, to stay in office pending the results of reconciliation talks between Hamas and Fatah over the formation of a unity government. The request came shortly after Fayad submitted his resignation to Abbas, saying he wanted to pave the way for the success of the Hamas-Fatah discussions that are expected to resume in Cairo later this week. In a letter to Abbas, Fayad said that his resignation would go into effect as soon as a unity government is formed, but no later than the end of March. Fayad's resignation came as a surprise to Abbas and the PA leadership, a PA official in Ramallah told The Jerusalem Post. He pointed out that although Fayad had in the past talked about the possibility of stepping down, "in recent weeks there were no indications whatsoever that he was planning to resign." Chief PA negotiator Saeb Erekat said the top priority for the Palestinians at this stage was to end the power struggle between Hamas and Fatah and achieve national unity. The June 2007 Hamas "coup" in the Gaza Strip was being used by Israel to solidify the de facto separation between the West Bank and the Gaza Strip, he said. As far as the Palestinians were concerned, the issue of unity has become an "existential matter," Erekat added. He accused Israel of trying to "push the Gaza Strip into the arms of the Egyptians." Fayad's decision drew praise across the Palestinian political spectrum, with many saying he had sacrificed his job for the sake of national unity. However, some Palestinians expressed fear that Fayad's departure from the scene could delay the transfer of badly needed financial assistance to the PA, and would hamper efforts to secure international aid for rebuilding the Gaza Strip in the wake of Operation Cast Lead. This is because the international community trusted Fayad, who is not affiliated with either Hamas or Fatah, and was impressed with his achievements in reforming the PA and holding it more financially accountable. "Most of the money that came from the Americans and the Europeans was because of Salaam Fayad," said a newspaper editor in Ramallah. "They might now use Fayad's resignation as an excuse not to send more money." A State Department spokesman said Fayad's departure wouldn't affect further funding going to the Palestinians. "Our assistance is to the Palestinian Authority and it's not conditional on Fayad," he said. "We don't envision that changing." Congress, however, has to approve money given to the PA, including most of the $900 million America recently pledged to ease the humanitarian crisis in Gaza and spur further development in the West Bank. Congressional leaders have placed a great deal of trust in Fayad, and his departure would almost certainly complicate the Congressional approval process. The State Department spokesman praised the "great strides" Fayad's government had made in "providing the transparency, accountability and security" essential to a two-state solution. He indicated that America expects future governments to continue this process as well as to adhere to the Quartet principles, which require that Hamas renounce violence, recognize Israel and respect previous Palestinian-Israeli agreements. At a meeting of the PLO executive committee in Ramallah, Abbas said Fayad submitted his resignation "to enhance and support" efforts to achieve reconciliation between Hamas and Fatah. Abbas praised the efforts of Fayad's government over the past 20 months to improve the economic, social and security situation in the West Bank. He also expressed hope that the talks with Hamas, which are expected to resume in Cairo on Tuesday, would result in agreement on a unity government by the end of the month. The committee later issued a statement in which it praised Fayad for his decision to step down as a "responsible move." The committee hailed the Fayad government for "playing a prominent and essential role in the most difficult circumstances, especially after the Hamas coup in the Gaza Strip." It also praised the government for implementing financial and administrative reforms and "consolidating transparency." Fayad said that since its establishment, his government had done its utmost to "salvage the homeland" from the economic and security deterioration that reached its peak in 2007 when Hamas took full control over the Gaza Strip. He added that a unity government was needed to "reunite" the West Bank and the Gaza Strip, safeguard Palestinian democracy and prepare for presidential and parliamentary elections that would be held at the beginning of next year. The Hamas-Fatah talks have thus far been encouraging, Fayad said. Five Hamas-Fatah committees that were established to resolve the disputes between the two groups were expected to conclude their work by the end of the month, he said. Hamas welcomed Fayad's resignation, but dismissed his claim that it was linked to the reconciliation talks in Cairo. Taher a-Nunu, spokesman for the Hamas government in Gaza, said his government should be allowed to operate in the West Bank following Fayad's resignation. The Fayad government, he said, was an "illegitimate government" that was functioning in violation of the law and against the will of a majority of Palestinians who voted for Hamas's Reform and Change List in the January 2006 parliamentary election. The Hamas spokesman said that Fayad's resignation was not connected to the talks with Fatah, but came for "various other reasons." He did not elaborate. But another Hamas spokesman, Fawzi Barhoum, said Fayad's decision was the result of sharp differences that had erupted between him and Abbas. "Hamas is not sorry for the resignation of Fayad," he said. "This was the end we expected for this illegitimate government, because it was established on the basis of an American agenda and failed policies." The Popular Front for the Liberation of Palestine also welcomed Fayad's resignation, describing it as a positive move toward the formation of a PA unity government. Hilary Leila Krieger contributed to this report.