An Israeli Foreign Ministry report leaked to Ha'aretz daily on Wednesday said the country could benefit from a Fatah-Hamas unity government, while Israeli officials continued to express their opposition to the internal Palestinian reconciliation deal.

According to the document that was leaked to the Ha'aretz daily, "the Palestinian move is not only a security threat but also a strategic opportunity to create genuine change in the Palestinian context."

After a bloody four-year rivalry, the two Palestinian factions will sign on an Egyptian-brokered reconciliation accord at a ceremony in Cairo on Wednesday. The two sides hope to hold elections within a year.

"Such change may serve the long-term interests of Israel," the report said, suggesting that diplomatic flexibility on Israel's part could serve as a fulcrum to push Fatah to moderate Hamas leaders oft-stated intent to destroy Israel, as enshrined in the Islamic group's founding charter.

However, Israeli officials have strongly maintained that Hamas is a terrorist group, citing recent deadly missile attacks from Gaza against Israelis. The Israelis stressed that they will not hold any contacts with the PNA as long as it is in an alliance with Hamas.

Israeli Prime Minister Benjamin Netanyahu, who on Tuesday met with Quartet envoy Tony Blair prior to his flight to France and Britain, made a last-minute bid to stall the signing, and called on PNA President Mahmoud Abbas to turn down the accord.

"I call on Abu Mazen (Abbas) to annul the agreement with Hamas immediately and choose the path of peace with Israel," Netanyahu said during the meeting with Blair, which centered on the lack of advancement in negotiations between Israel and the Palestinians, the targeting killing of al-Qaida head Osama bin Laden and other diplomatic issues, according to the Prime Minister's Office.

"The agreement between the PNA and Hamas is a hard blow to the peace process," Netanyahu said, "how is it possible to achieve peace with a government, half of which calls for the destruction of the State of Israel and even praises Osama bin Laden?"

However, a Foreign Ministry source who requested anonymity told Xinhua on Wednesday that the report issued by the policy planning department, did not represent the ministry's position.

"While it is certainly true that there are many departments that express a variety of opinions," the official said, "to take one opinion out of many that may be expressed in any government office is certainly not going to be reflective of any single reality."

Netanyahu is scheduled to meet with British Prime Minister David Cameron on Wednesday, when he is expected to implore his counterpart not to support the Fatah-Hamas accord, and block the PNA's stated bid for a United Nations statehood resolution, at the U.N. General Assembly in September.

The Israeli premier will later go to Paris to make the same case to French President Nicolas Sarkozy.

The ministry report, the Israeli diplomat told Xinhua, might weaken Netanyahu's case before the British and French leaders.

"Its timing is certainly not conducive, but perhaps that was the point," the source said of the leak, implying that the behind- the-scenes intent was to impede Netanyahu from pressing his case with foreign leaders.

Netanyahu was not the only Israeli official making a case to foreign leaders not to support the Palestinian's statehood bid.

Israeli Deputy Foreign Minister Danny Ayalon said Wednesday that "it is clear that the PNA is reluctant to move towards peace. The fact that the PNA prefers Hamas over negotiations for peace delivers a mortal blow to the process."

Ayalon, in a meeting with Estonian Foreign Minister Urmas Paet, told European Union leaders that "as the largest funders of the PNA, you have a heavy responsibility to make it clear to the Palestinians that failure to comply with the Quartet's conditions will be met with sanctions."