Prime Minister Ehud Olmert told Knesset Members on Monday he feels it is important to maintain ties with Palestinian Authority Chairman Mahmoud Abbas. He had met earlier with the Fatah leader and U.S. Secretary of State Condoleezza Rice in Jerusalem.

"There will be discussions," Olmert told legislators. "We will continue the communications channel with Abu Mazen [Abbas’ nom de guerre]. We are not willing to create a situation in which no channels of communications exist with the Palestinian public. I think that would be a grave mistake."

Olmert, Abbas and Rice met for a two-hour session Monday morning at a Jerusalem hotel before being joined by Foreign Minister Tzipi Livni, Vice Premier Shimon Peres, Defense Minister Amir Peretz and senior Fatah officials in the PA.

"All three of us affirmed our commitment to a two-state solution," Secretary Rice announced afterwards, "and agreed that a Palestinian state cannot be born of violence and terror." She added that Olmert and Abbas had "reiterated their acceptance of previous agreements and obligations," including their commitment to the American-authored Road Map plan. She said that the three had agreed to meet again.

The Prime Minister said that Abbas was told at the so-called summit – as he had been on Sunday, as well as the week before – that any Palestinian Authority government must meet the Quartet conditions in order to gain recognition from Israel and the international community.

The Quartet – U.S., Russia, United Nations and European Union – has demanded that the Hamas-led Palestinian Authority recognize Israel, renounce terrorism and comply with previously-signed agreements.

"This does not mean recognition via some sort of empty statement," emphasized Olmert during the Knesset session, " but [rather] carrying out all of these agreements, recognizing the right of the State of Israel to exist as a Jewish state, and of course an absolute halt to terrorism in all its expressions – Kassam fire and attempts to perpetrate other attacks."

Olmert added that the issue of returning kidnapped IDF officer Gilad Shalit, who was abducted last June by Hamas terrorists, was also very much a part of Israel’s demands. "It is clear that all other commitments – including the release of Gilad Shalit immediately – must be upheld," he said, emphasizing that Israel “will not recognize any government that does not honor these commitments. Neither will we cooperate with it or its ministers."

Despite all the caveats, however, Olmert agreed to meet again with Rice and Abbas. Moreover, the Associated Press reports it was decided at the meeting that Israel will release more than $100 million in taxes collected on behalf of the PA to Abbas within 24 hours. The money will reportedly be used to strengthen his personal security forces as well as provide humanitarian relief.