BETHLEHEM (Ma'an) -- European diplomats trying to persuade Palestinian leaders to seek an upgrade of their UN status without full membership have had "meaningful progress," Israeli media said.

Hebrew-daily Yedioth Ahronoth quoted a senior Israeli source on Thursday saying Palestinians' acceptance of this proposal will improve their UN standing, while allowing Israel to coexist with the new status.

The report noted that the proposal means Palestinians will not join the International Criminal Court as President Mahmoud Abbas has indicated, allaying Israeli fears of prosecutions at the Hague.

Meanwhile US ambassador to the United Nations Susan Rice told the paper on Thursday that the country was not involved in talks over a Palestinian draft of the resolution.

"We’re not negotiating any text, we’re not engaged in efforts to water down a text," she told reporters. "Nobody in New York has seen one."

On Friday Arabic-daily Al-Hayat reported that four clauses of a draft proposal to the UN had been agreed in talks between the EU and PA, including a call to resume negotiations, halt Israeli unilateral moves, and accept World Bank and IMF reports on Palestinians ability to govern an independent state