Palestinian Authority Chairman Mahmoud Abbas said Wednesday that Egypt had presented Israel and the Hamas with a new proposal regarding a prisoner exchange deal aimed at securing the release of captured Israel Defense Forces soldier Gilad Shalit.

At the end of a meeting between Abbas and Meretz chairman Yossi Beilin in the West Bank city of Ramallah, Abbas said two to three weeks would be needed to discuss the Egyptian proposal.

Abbas also told reporters on Wednesday that if the aid embargo placed on the Palestinian Authority just over a year ago isn't lifted, the Palestinian Authority will collapse within two months.

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"Anyone who thinks that they can topple the Palestinian government without bringing about the collapse of the Authority doesn't know what he is saying," Abbas told reporters.

According to Abbas, European states will continue to support the Palestinian government. "There is a desire on the part of European nations to deal with a Palestinian government, and they denounce the aid embargo on the Palestinian people," he said.

Before his meeting with Abbas, Beilin participated in a conference of Geneva Accord peace plan supporters in Ramallah. He called on Prime Minister Ehud Olmert to take advantage of the regional and international climate in order to advance the peace process. Beilin declared that currently there are 70 MKs that would support a peace agreement between Israel and the Palestinians, but the situation is likely to change if elections are held.

According to Beilin, the United States' growing involvement in brokering peace between the two nations, as well as the special task force established by the Arab League, are steps in the right direction. However, as long as Hamas is in power, Beilin said, the process will remain stalled because "the organization is unwilling to negotiate with Israel."

Last weekend, Abbas met twice with the political leader of Hamas Khaled Meshal in Cairo. Among other things, the two discussed the release of Gilad Shalit, who was captured by Hamas last June. Abbas' spokesman reported that the two also discussed the implementation of the Mecca peace deal, achieving calm between the Palestinians and Israel, and getting the international aid embargo lifted.