Netanyahu announces formation of Israeli coalition government

Israeli Prime Minister designate Benjamin Netanyahu said he as agreed deals to form a government (Maya Alleruzzo/AP)

Benjamin Netanyahu has announced that he has successfully formed a new coalition, setting the stage for him to return to power as head of the most right-wing Israeli government ever.

The Prime Minister designate made the announcement in a phone call to President Isaac Herzog moments before a midnight deadline.

His Likud Party released a brief video clip of a smiling Mr Netanyahu and a recording of the conversation.

Palestinians burn pictures of Benjamin Netanyahu (Adel Hana/AP)

The move came after weeks of surprisingly difficult negotiations with his partners, who still have to finalise their power-sharing deals with the Likud Party.

Nonetheless, Mr Netanyahu said he intends to complete the process “as soon as possible next week”.

Even if he is successful, Mr Netanyahu faces a difficult task ahead.

He will preside over a coalition dominated by far-right and ultra-Orthodox partners pushing for dramatic changes that could alienate large swathes of the Israeli public, raise the risk of conflict with the Palestinians and put Israel on a collision course with some of its closest supporters, including the United States and the Jewish American community.