The Palestinian cabinet resigned on Monday and Prime Minister Salam Fayyad will select new ministers at the request of President Mahmoud Abbas, officials said.   

The shake-up was long demanded by Fayyad and some in Abbas's Fatah faction. It followed the fall of Egyptian President Hosni Mubarak to a popular revolt that has set off reform calls throughout the Arab world.   

"The cabinet resigned today and the formation of a new cabinet will take place as soon as possible," Ali Jarbawi, minister of planning, told Reuters.   

A senior Palestinian official said Abbas plans to ask Fayyad, who has spearheaded efforts to build up Palestinian government institutions ahead of statehood, to form a new cabinet.

Bankrolled by international donors and engaged in security coordination with Israel, the Palestinian Authority has a limited mandate in the occupied West Bank. It lost control of the Gaza Strip to Hamas Islamists in a 2007 civil war.

Abbas's credibility has been further sapped by long-stalled negotiations with Israel on an accord founding a Palestinian state. Hamas spurns permanent co-existence with the Jewish state.

Of the 24 posts in Fayyad's outgoing cabinet, only 16 were staffed. Two ministers resigned and six are marooned in Gaza. Of those present in the cabinet, some face allegations of incompetence.

The Palestinian Authority announced on Saturday it would seek new legislative and presidential elections by September but Hamas rejected that call and said it would not take part in the poll, nor recognise the results. - Reuters