RAMALLAH, West Bank (AFP) - Palestinian President Mahmud Abbas on Monday rejected Israeli Prime Minister Benjamin Netanyahus demand to recognise Israel as a Jewish state. A Jewish state, what is that supposed to mean? Abbas asked in a speech in the West Banks political capital of Ramallah. You can call yourselves as you like, but I dont accept it and I say so publicly. Abbas said the topic was extensively discussed and rejected by the Palestinians during a November 2007 international conference in Annapolis, near Washington, at which the two sides relaunched peace negotiations. Netanyahu has demanded the Palestinians recognise Israel as a Jewish state as part of an eventual peace deal. Such a move would amount to an effective renunciation of the right of return of refugees from the 1948 Arab-Israeli war, when Israel was created, a cherished principle of the Palestinians. The Israeli foreign ministry reacted to Abbass statement by saying recognition of Israel as the sovereign state of the Jewish people is an essential and necessary step in the historic process of reconciliation between Israel and the Palestinians. The more the Palestinians assimilate this fundamental and substantive fact, the sooner the peace between the two nations will progress toward fruition, the ministry said. Abbas also criticised Israels firebrand Foreign Minister Avigdor Lieberman, who said the new cabinet was not bound by the previous governments decision taken at Annapolis to relaunch peace talks with the Palestinians. Lieberman is in a class by himself. He has yet to learn the art of politics and he has not yet practised politics enough. He is an adversary, he has come to say 'no and 'I reject and every chance he gets he comes up with a new refrain, he said. On the latest round of Palestinian reconciliation talks, which opened on Monday in Cairo, Abbas said if the parties managed to form a unity government, that cabinet would have to abide by past Israeli-Palestinian accords. It is the government and its members that should respect such deals and not movements, Abbas said. Should the Palestinians form a unity government, the cabinets top priority would be reconstruction in the Gaza Strip, where the Israeli military carried out a devastating 22-day offensive in December-January. Another priority will be preparing for combined presidential and parliamentary elections before January 24, 2010, the date when the mandate of the current legislature dominated by Hamas expires, Abbas said.