Palestinian prime minister Ahmed Qorei reached an uneasy truce with veteran leader Yasser Arafat Tuesday, refusing to retract his resignation but agreeing to stay in his post for the moment.
"There has been no breakthrough. Abu Alaa (Qorei) has not changed his position about resigning," minister without portfolio Qadura Fares said after Qorei and his cabinet met with Arafat at his leadership compound here.
"Abu Alaa is prepared to continue in his position for the time being but only until the formation of a new government," he told AFP.
Qorei submitted his resignation on Saturday after a breakdown in law and order in the Gaza strip including an unprecedented spate of kidnappings but Arafat has refused to accept it.
After street protests in Gaza forced him to execute an embarrassing U-turn over his choice of security supremo on Monday, Arafat can ill afford to be seen losing a battle of wills with his prime minister.
Arafat's top aide Nabil Abu Rudeina tried to insist that the stand-off between the two men had been resolved in Tuesday's meeting.
"At today's meeting, President Arafat repeated his refusal to accept Abu Alaa's resignation and he renewed his confidence in him," he told reporters.
"The resignation of Abu Alaa has been officially refused and he will remain in his place and the issue is finished."
"President Arafat completely rejected the resignation of Abu Alaa but Abu Alaa is still insisting that he is resigning," he told AFP.
"The crisis is still ongoing, not because of Abu Alaa's resignation but because of the reasons behind his resignation.
"We hope to overcome this crisis as soon as possible in the interests of the Palestinian people."
The crisis was also expected to be played out on the floor of the Palestinian parliament on Wednesday when a committee tasked with investigating security in the territories delivers a report.
Former information minister and current MP Nabil Amr said that the atmosphere was likely to be "very hot" and said there was a possibility that deputies would push for a no-confidence motion in the Qorei government.
The Gaza protests, which at one stage erupted into armed clashes between the security forces and militants traditionally loyal to Arafat, was sparked by the appointment of his unpopular cousin Musa as head of the general security service.
Arafat subsequently demoted Musa on Monday by naming Abdel Razzeq al-Majeida as overall security supremo with his cousin's responsibility limited to Gaza.