Jerusalem (CNN) -- Israel's Security Cabinet announced Thursday the country won't hold peace negotiations with a Palestinian government backed by the militant Hamas movement. The development came a day after Palestinian rival movements Fatah and Hamas embarked on an effort to form a unity government. The Security Cabinet is the part of the Israeli full Cabinet tasked with making security decisions. "Instead of choosing peace, Abu Mazen formed an alliance with a murderous terrorist organization that calls for the destruction of Israel,' said Prime Minister Benjamin Netanyahu, referring to Palestinian President Mahmoud Abbas. "Whoever chooses the terrorism of Hamas does not want peace."
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NEW: Israeli military, Palestinian militants clash near Gaza border
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Netanyahu calls Hamas "a murderous terrorist organization"
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This comes amid a deterioration of U.S.-brokered peace talks
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Hamas runs Gaza and Fatah dominates in the West Bank
Reconciliation talks started Tuesday evening, after Abbas sent a @placeholder delegation to meet with Hamas representatives in Gaza.