The race to replace Yasser Arafat was thrown wide open on 1 December when the gaoled senior Fatah leader Marwan Barghouti unexpectedly registered as a candidate for the Palestinian presidential elections on 9 January.

Arafat lieutenant Mahmoud Abbas (Abu Mazen) has been favourite to win the election and as recently as late November Barghouti, who is serving five life terms in an Israeli jail, said he would not run and expressed support for Abbas.

His volte-face represents a real threat to Abu Mazen. Barghouti has wide popular support among Palestinians. He cut his political teeth on the streets during the first Palestinian intifada in the late 1980s, while Arafat, Abu Mazen and other Palestinian leaders were in exile in Tunisia. His backing of the use of arms against Israel during the current intifada has seen his popularity continue to rise.

However, his last-minute entry has been widely criticised. A Fatah spokesman said that by running as an independent, Barghouti had given up his Fatah affiliation. 'We regard Marwan's position as astonishing and reprehensible,' he said. US Secretary of State Colin Powell said Barghouti's candidacy could be 'problematic'. Tel Aviv said it would deal with Abu Mazen, while Barghouti should not expect to be released early.

Israeli Prime Minister Ariel Sharon is also fighting to save his coalition government after he sacked its junior Shinui ministers when they voted against the government in the defeat of the annual budget in parliament on 1 December.

Sharon, whose Likud party has 40 of the 120 Knesset seats, is expected to approach the left-wing Labour Party to join his coalition. If he fails, it may derail his plans to withdraw Israeli troops and settlers from Gaza. Sharon wants to complete a new coalition deal on 6 December, when a possible no-confidence vote could force a general election. To bring Labour on board, he would have to overcome strong objections within Likud, which is itself deeply divided. Labour leader Shimon Peres is keen on the idea of joining the government as foreign minister, but some Labour politicians may be unhappy about supporting Finance Minister Binyamin Netanyahu's economic policies.

Also on 1 December, Tel Aviv and Cairo agreed the deployment of 750 Egyptian troops on the Gaza border ahead of Israel's planned withdrawal. The move is intended to check a possible post-pullout power grab by militant groups, such as Hamas. The Egyptian police will be deployed on the Philadelphi route along the border to stop weapons being smuggled into Gaza.