Palestinian Authority Chairman and Fatah leader Mahmoud Abbas rejected Prime Minister Ehud Olmert's final status proposal Tuesday afternoon because it did not provide for a contiguous PA state with Jerusalem as its capital.

Abbas spokesman Nabil Abu Rdainah said in a statement to the WAFA news agency that the plan displayed a "lack of seriousness." Earlier reports had said that Abbas and Olmert had agreed to leave the question of Jerusalem on the back burner for the time being.