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Palestinian Authority Chairman Mahmoud Abbas will meet with Hamas' Damascus-based political chief Khaled Meshal in the Syrian capital on Saturday, a senior Palestinian lawmaker who has been mediating between the two said Thursday.

Ziad Abu Amr told Haaretz that there has been a certain amount of progress in talks on the formation of a Palestinian unity government, but there are still disagreements on several issues that must be clarified by the leaders.

The meeting will bring to an end a long period in which the ties between the two were frozen, due to a speech Meshal gave in Syria in which he harshly attacked Abbas.

Militants: Hamas alone holding ShalitThe Army of Islam, one of the three groups responsible for abducting and holding Israeli soldier Gilad Shalit, issued a handbill on Wednesday proclaiming that only Hamas was holding Shalit.

The proclamation, distributed in the Gaza Strip, runs contrary to all the organization's announcements to date, which have emphasized that three groups were holding Shalit.

The Islamic Army is headed by Mumtaz Dormush, who recently fell out with Hamas after its activists killed two of his relatives. It is not clear if the handbill is authentic. However, by late last night, no Army of Islam spokesman had denied it.

The handbill blasted Hamas for making political use of Shalit's abduction and of the prisoners' issue, instead of acting swiftly to obtain the release of Palestinian prisoners.

Meanwhile, talks in Damascus on setting up a Palestinian national unity government have ended without results, Palestinian sources told Haaretz on Wednesday.

The talks were held between senior Hamas officials and two Palestinian mediators, Mohammed Rashid, onetime economic adviser to Yasser Arafat, and PA parliament member Ziad Abu Amar. Apparently the talks broke down over the powers that PA Chairman Mahmoud Abbas was to grant the next prime minister in his letter of appointment, and over who the next interior minister would be.