Palestinian Authority Chairman Mahmoud Abbas has received assurances that Western donors will end an aid embargo against the Palestinian Authority once a coalition government is formed, Hamas lawmaker Salah Bardawil said Tuesday.

"We have had clear words from the president that there are American, European and Arab guarantees that the siege will be lifted," Bardawil said.

Western donors cut off hundreds of millions of dollars in aid to the Palestinian government after Hamas won legislative elections early this year. The "Quartet" of Mideast peacemakers - the U.S., European Union, Russia and United Nations - has called on the militant group to renounce violence and recognize Israel's right to exist.

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Micaela Schweitzer-Bluhm, spokeswoman for the U.S. Consulate in Jerusalem, said there has been no change in the American position. "Our position has been very clear. We are looking for a Palestinian government that accepts the Quartet principles," she said.

Abbas, a political moderate from the rival Fatah movement, is in Gaza negotiating with the militant group to replace the current Hamas-led government with a Cabinet comprised of independent experts.

He hopes the new government will help get the boycott lifted. However, it appears unlikely that the platform of the emerging government will meet the international demands.

Abbas calls on Hamas to give him custody of Shalit
Meanwhile, Abbas requested Tuesday that Hamas release kidnapped Israel Defense Forces soldier Gilad Shalit to his custody, so that he can begin negotiations with Israel over his release.

Abbas made the comments in an interview published Tuesday in the Saudi daily newspaper Asharq Al Awsat.

The exiled head of the Hamas political bureau, Khaled Meshal, on Tuesday vowed that Hamas would continue to kidnap IDF soldiers until all Palestinians held in Israeli jails are released.

Abbas is expected to meet Wednesday with Palestinian Prime Minister Ismail Haniyeh of Hamas in a fresh bid to iron out differences over the formation of a unity government.

Deadlocked talks
Abbas and Hamas have been trying to forge a coalition for months. The talks hit a new snag on Monday night, when Haniyeh and Abbas met in the Gaza Strip, but failed to reach an agreement in the meeting described as a "decisive" discussion on the creation of a Palestinian government of national unity and the identity of the man who will lead it.

A spokesman for Abbas, Nabil Abu Rudeineh, said Abbas and Haniyeh would continue their meetings Wednesday and Thursday in order to complete the negotiations.

At the start of the meeting, Abbas informed Haniyeh that Israel would begin the withdrawal of its forces from the town of Beit Hanun in the Gaza Strip. During the six days the Israel Defense Forces operated in the town, 53 Palestinians and one soldier were killed.

Palestinian sources reported Monday night that the IDF had already begun withdrawing some of its forces. However, senior officers said that smaller scale operations would continue in other parts of the Strip. They added that the operation in Beit Hanun achieved its objectives and struck a heavy blow to militant groups there.

During their meeting Monday night, Haniyeh presented Naeem as a candidate for the post of prime minister. However, Palestinian sources said Abbas refused and expressed his disappointment at Haniyeh's proposal.

A spokesman for Abbas' Fatah in the Gaza Strip, Maher Makdad, told Haaretz Monday night that Abbas' opposition to Naeem's candidacy had been expected. There is an agreement in principle between Fatah and Hamas on the establishment of a government of experts, Makdad said.

Bardawil, however, denied reports that Abbas rejected the nomination. "I confirm he did not reject this name, but that the talk was that discussions will continue," he said.

Palestinian sources said that the radical wing of Hamas is opposed to another candidate, Jamal al-Khudary, currently the minister of communication in the Haniyeh government.

Al-Khudary is considered to be an independent candidate, with leanings toward Hamas, but also with ties to Abbas' son.

The meetings between the two sides in recent days resulted in agreement on the creation of a government of technocrats, with no political figures. Each party, depending on its strength in the Palestinian Legislative Council, will appoint professionals and academics to the cabinet.

A special committee comprised of representatives of all the factions will determine the specific ministries these individuals are most appropriate to manage.

Palestinian sources reported Monday that during the negotiations Hamas demanded guarantees from Abbas that the economic boycott of the Palestinian Authority would be lifted if the organization would agree to a national unity government of technocrats and a prime minister not affiliated to Hamas.

However, in a recent meeting between U.S. envoys Elliott Abrams and David Welch, and Abbas, it was made clear to the Palestinian leader that the Bush administration is unwilling to budge from its demands that the Palestinian government should meet the three prerequisites posed by the Quartet (recognition of Israel, relinquishing violence, and acceptance of previous Israel-PLO accords).

So far, Fatah and Hamas agreed that the political platform of the new government will be based on the prisoners' manifesto, a document authored by leading Palestinians held in Israeli prisons, which hints at recognition of Israel and a two-state solution.