Palestinian President Mahmoud Abbas, responding to an aide's call on Wednesday for a unilateral declaration of statehood if peace talks with Israel continued to falter, ruled out taking any such step soon.

"We will pursue negotiations in order to reach a peace agreement during 2008 that includes the settlement of all final status issues including Jerusalem," Abbas said in a statement.

"But if we cannot achieve that, and we reach a deadlock, we will go back to our Arab nation to take the necessary decision at the highest level," he said, without mentioning any options.

Yasser Abed Rabbo, a member of the Palestinian negotiating team with the Israelis, told Reuters that if they could not reach a deal with Israel, the Palestinians could consider declaring independence like Kosovo did on Sunday.

"If things are not going in the direction of actually halting settlement activities, if things are not going in the direction of continuous and serious negotiations, then we should take the step and announce our independence unilaterally," Abed Rabbo said.

Drawing an analogy to Kosovo, he said: "Kosovo is not better than us. We deserve independence even before Kosovo, and we ask for the backing of the United States and the European Union for our independence."

"This is what the Israelis are driving us to," he added, in an interview with the Voice of Palestine radio station.

However, the chief Palestinian negotiator, Ahmed Qureia, quickly quashed the idea of a unilateral declaration, saying it was never brought before the Palestinian leadership.

"Decisions should be taken and then declared, and not be declared and then be taken," Qureia said, in an apparent reprimand of Abed Rabbo.

Qureia said negotiations with Israel were serious, and were touching on all major issues, but that no progress has been made so far.

Saeb Erekat, another senior Palestinian negotiator, also voiced opposition to any unilateral declaration of independence, saying the Palestine Liberation Organization had already declared independence in 1988.

"Now we need real independence, not a declaration. We need real independence by ending the occupation. We are not Kosovo. We are under Israeli occupation and for independence we need to acquire independence," Erekat said.

The Palestinian officials spoke a day after a meeting between Abbas and Prime Minister Ehud Olmert at the prime minister's office in Jerusalem yielded no visible results.

Meanwhile, Erekat said late Tuesday that despite Israeli claims, Abbas and Olmert did in fact discuss the contentious topic of Jerusalem during their meeting earlier that evening.

A senior official in the Prime Minister's Office said after the talks: "The issue of Jerusalem did not come up in the discussion. I'm not aware of changes in the Israeli position."

But Erekat disputed the claim, saying the leaders had discussed "all the core issues."

Israel, PA talks to venture outside three 'core issues'

Meanwhile, Abbas and Olmert agreed on Wednesday to expand their negotiations to topics beyond the "core issues" of borders, Jerusalem and the refugees: Within two weeks, teams will be set up to discuss at least seven other issues.

The two assigned the heads of the negotiating teams on the core issues - Foreign Minister Tzipi Livni and former Palestinian prime minister Ahmed Qureia - the job of deciding exactly which issues the new task forces should begin discussing, and Livni hopes to reach an agreement with Qureia on this matter soon.

While the foreign minister would prefer the talks on the core issues to take place in maximum secrecy, the talks on the new issues will be conducted with far greater openness, which she hopes will attract media attention and thereby create a feeling of momentum in the negotiations.

One of the most important new issues on which Israel hopes to begin talks is the development of a "culture of peace," with an emphasis on ending incitement to terrorism.

Israel would like to reach agreements with the PA on preventing media incitement, encouraging people-to-people activities and changing parts of the Palestinian school curriculum, which Israel says negates its right to exist.

On Sunday, Livni held discussions with representatives of several other government ministries to formulate Israel's positions on these issues.

The other topics on which Israel proposes starting negotiations are as follows:

State-to-state issues, such as an exchange of ambassadors and Palestinian membership in international organizations.
Water. Most of the work on this issue was completed at the Camp David talks in 2000, but a few details remain to be settled.
Internal security - primarily, future cooperation between the Israeli and Palestinian police forces on issues such as crime fighting and road safety.
Civil security issues, such as entry permits into Israel, border crossings and Israeli-Palestinian security cooperation.
Economic issues. The goal is to define the nature of the economic relationship between the two states, on issues such as customs duties, tax collection, free trade zones, etc.
Environment. The focus will be on issues such as waste management, sewage and treatment of hazardous materials.

The Abbas-Olmert meeting had been widely expected to focus in part on the contradictory statements the two leaders have made about Jerusalem in recent days: Olmert has claimed that Abbas agreed to postpone this issue until the end of the talks, while Abbas denies this.

However, a senior official in the Prime Minister's Office said that while he could not say what was discussed when the two leaders met privately, "the issue of Jerusalem did not arise at all" in the portion of the talks where their staffs were present.

Olmert's office also said that both leaders expressed satisfaction with the pace of the talks and the progress to date.

The two men also discussed several more immediate issues, including Abbas' request that Olmert reopen Israel's border with Gaza.

However, Olmert declined to make any promises on this issue beyond pledging that "Israel will not allow a humanitarian crisis to develop in Gaza."

Abbas also demanded the removal of numerous roadblocks and other measures to ease freedom of movement in the West Bank, and complained that construction in West Bank settlements was continuing despite Olmert's pledge to halt it.