JERUSALEM - Israel will clamp down on Palestinian areas, cutting the West Bank off from Gaza, banning Gaza workers from Israel and halting most funding, in a campaign to weaken the violent Hamas as it assumes power.
The tough measures emerged from a security meeting Thursday, and acting Prime Minister Ehud Olmert is expected to sign off on them Friday.
Israel's Cabinet is to approve them Sunday and put them into effect immediately - the day after the new, Hamas-dominated Palestinian parliament takes office.
Palestinian leader Mahmoud Abbas, meanwhile, will demand that Hamas publicly accept his goal of reaching a peace deal with Israel and recognize past agreements with the Jewish state, officials said.
Since Hamas won Palestinian legislative elections last month, Israeli leaders have taken a tough line against the group. They have rallied international opposition to Hamas and said there will be no dealings with the militants until they change their ways.
On Thursday, senior Israeli officials approved a series of tough measures aimed at crushing the Gaza Strip's already teetering economy.
"The swearing-in of the Palestinian parliament on Saturday rings a gong for us," Defense Minister Shaul Mofaz said, according to meeting participants. "A Hamas government will mean an authority of terror and murder."
Israel will bar Gaza laborers, stripping about 4,000 Palestinian families of their main source of income, and halt the movement of Palestinian officials between the West Bank and Gaza.
Later Israel will consider even tougher economic sanctions, including restrictions on Palestinian exports, the officials said.
Blocking access to Israel would be devastating to for Gaza. The Israeli market is the largest for the impoverished coastal strip, and most of Gaza's exports to the rest of the world go through Israeli ports.
The campaign is aimed at isolating the Gaza Strip from the West Bank. The Palestinians claim both areas, separated by Israeli territory, for a future state.
Israeli is likely to halt monthly transfers of about $50 million in taxes and customs duties it collects for the Palestinians. The transfers are crucial for the Palestinian Authority to pay salaries to 140,000 government workers. Israel has said humanitarian aid would continue.
Mushir al-Masri, an incoming Hamas lawmaker, condemned the Israeli economic threats.
"This is collective punishment on our people," he said. "The world should realize that more pressure on the Palestinian people will create more tension and everyone is going to be a loser, including Israel."
Israeli critics warn that the measures could plunge ordinary Palestinians even deeper into poverty, encouraging extremism and violence. Criticizing the funding cuts, moderate Labor Party leader Amir Peretz said there are "indirect ways" to "get around Hamas and strengthen moderate forces" among the Palestinians.
At the parliament session Saturday, Abbas will ask Hamas to form a new Cabinet that recognizes interim peace agreements with Israel and his efforts to reach a permanent settlement, said Nabil Abu Rdeneh, a top aide to Abbas.
"Any new government should be a continuation of the previous government," Abu Rdeneh said. "They have to say this publicly and in writing."
Abu Rdeneh declined to spell out what action Abbas would take if Hamas refuses to accept his program, saying, "it's too early to talk about this."
Abbas' speech is likely to kick off a drawn-out negotiating process. Once Abbas taps Hamas to form a new Cabinet, the militants will have five weeks to do so.
"We are really going to have a showdown and a major crisis," said Saeb Erekat, a Fatah lawmaker and outgoing chief negotiator with Israel.
Mushir al-Masri, an incoming Hamas legislator, expected a compromise.
"I think that always we can find common understandings," he said. "All of us are shouldering joint responsibility to serve the interests of our people."
In a sign of pragmatism, Hamas officials said they would nominate Ismail Haniyeh, a relative moderate, to be the next prime minister. The 46-year-old Haniyeh, a resident of Gaza's Shati refugee camp, has served as a liaison between Hamas and the outgoing Fatah-led government.