RAMALLAH, June 9 (IslamOnline & News Agencies) - Palestinian President Yasser Arafat announced Sunday his new cabinet, reducing it to 21 ministers instead of 31 and bringing in five new faces, including its first interior minister other than Palestinian leader Yasser Arafat.

"This government has been reduced to 21 members for 21 ministries," Palestinian Information Minister Yasser Abed Rabbo told reporters at the news conference held in the West Bank city of Ramallah.

"Some ministries were merged together and others were introduced and the number of ministers was trimmed," Abed Rabbo said.

"This transitional government will have the task of preparing the municipal, legislative and presidential elections, slated for the end of 2002 and the start of 2003," Abed Rabbo said.

General Abdel Razak al-Yahiya, a former negotiator with Israel, is the new interior minister. Since the Palestinian Authority was established in 1994, Arafat had served as the acting minister.

He will head the security apparatus, merging the dozen different police and intelligence services, Agence France-Presse (AFP) said.

The other prominent newcomer will be Salam Fayad, West Bank head of the Arab Bank, replacing Mohammed Zohdi Nashashibi as finance minister.

Major players such as Nabil Shaath (international cooperation), Saeb Erakat, (local government) and Maher Masri (economy) will remain, while some have swapped posts.

The new cabinet is being announced as Israeli Prime Minister Ariel Sharon prepares to meet U.S. President George W. Bush Monday to plead for Arafat to be written off as a partner in the Middle East peace process.

Some ministries, such as education, housing, public works, industry, trade, economy, culture and information and social affairs were to be merged, while others, like environment, parliamentary affairs and sports are subsumed.

Bush said Saturday at a joint press conference with Egyptian President Hosni Mubarak that the reform of Palestinian institutions was a priority for Washington.

"We need to start immediately in building the institutions necessary for the emergence of a Palestinian state," Bush said, while rejecting Mubarak's call for a timetable, AFP said.

Parliament speaker Ahmed Qorei said later that local elections would take place before the end of this year and legislative elections in 2003. A presidential election could be held in December this year, he added.

Islamic resistance group, Hamas, Islamic Jihad, the Popular Front for the Liberation of Palestine and the Democratic Front for the Liberation of Palestine were invited to join the new cabinet but declined, saying that the gesture of inviting them to join the government was highly appreciated.

The new cabinet brings in three other new faces: Ghassan al-Khatib, a noted political analyst and a member of the communist People's Party, as labor minister; Ibrahim Dughmeh as justice minister; and Naim Abul Hummus for education, AFP reported.

Khatib takes over from Rafiq Natshe, who has been shifted to the ministry of agriculture, while Dugmeh replaces Freih Abu Middein at justice. Hummus's post had previously been vacant and now combines the ministries of education and higher education.

The Waqf minister, who is charged with Islamic affairs, will be appointed in the coming days.

The stripped-down cabinet does away with the ministry of parliamentary affairs, whose previous head, Nabil Abu Amr, resigned in May in protest at what he saw as the slow pace of reforms.

The authority has also abolished the ministry for non-governmental organizations and the ministries of Jerusalem and prisoner affairs.

Jerusalem affairs will now be managed by the Palestine Liberation Organization’s (PLO) representative to Jerusalem, pacifist Sari Nusseibeh, while prisoner affairs will be handled by the civil affairs ministry.

The elimination of the Jerusalem ministry removes Ziad Abu Ziad, an influential member of Arafat's Fatah movement, from the cabinet.

The reshuffle also includes two other mergers: the ministry of trade and economy with the ministry of industry; and the ministry of public works with that of housing.