Israeli Prime Minister Benjamin Netanyahu's vision for ending conflict with Palestinians put "more obstacles" in front of the Middle East peace process, the spokesman for the Palestinian president said.

"There was nothing new in Netanyahu's speech other than more obstacles in front of the peace process," Nabil Abu Rdainah, the spokesman for President Mahmoud Abbas, told Reuters following Israeli leader's address to the U.S. Congress on Wednesday.

Netanyahu's proposals included terms long rejected by the Palestinians. He said they should recognise Israel as a Jewish state and accept a long-term Israeli military presence in the Jordan Valley, which the Palestinians envisage as the eastern border of their state.

"We will not accept any Israeli presence on the lands of the Palestinian state," Abu Rdainah said.

"Real peace is based on a Palestinian state on the 1967 borders with East Jerusalem as its capital," he added, in reference to Israel's borders with the West Bank and the Gaza Strip as they stood on the eve of the 1967 Middle East war. The Palestine Liberation Organisation, headed by Abbas, wants to found a state alongside Israel in the territories captured by Israel in the 1967 conflict.

The two-decade old peace process which the Palestinians hoped would yield that goal has been at a standstill since September due to a dispute over Jewish settlement building on land captured in the war.

The PLO recognised Israel at the outset of the peace process but has always refused to acknowledge it as a Jewish state, saying this would prejudice the rights of Israel's Arab minority.

Criticising Netanyahu's call on Abbas to "tear up" a unity agreement to end a feud with the Islamist group Hamas, Abu Rdainah said reconciliation was an internal affair that had nothing to do with Israel.

"What came in Netanyahu's speech will not lead to peace," Abu Rdainah said.