"Stopping assistance to the Palestinian Authority, cutting aid, will exacerbate the deteriorating economic and social situation," Abbas told the European Parliament. He said the cuts left the Palestinians facing a "humanitarian catastrophe."
The EU and the United States froze hundreds of millions of dollars (euros) in direct aid to the Palestinian government after the Islamic militant group Hamas won legislative elections in January. Washington and the EU list Hamas as a terrorist organization and have demanded the group renounce violence and recognize Israel.
Abbas said he hoped to start a "national dialogue" in the next few days that could lead the Hamas government "to amend its platform" and conform with commitments to the peace process made by the previous Palestinian administration.
"Our approach needs the support of the international community," Abbas told the EU assembly. "The new government must be given the chance to adapt to the basic requirements of the international community."
He warned of dire consequences if the Israeli government goes ahead with plans to impose a border on the Palestinians.
"The attempt to implement these unilateral projects will destroy any remaining hope of reviving the peace process," Abbas said. "It will also lead to another bitter era of tension and conflict for which peoples in this region have, for decades, paid a heavy price."
EU foreign ministers on Monday said the bloc was moving swiftly ahead with plans to get financial aid to the Palestinians without it reaching the Hamas government.
External Relations Commissioner Benita Ferrero-Waldner said a temporary trust fund to handle the money could be set up as early as June.
The aid cutoff, along with Israel's decision to withhold the transfer of more than USD 50 million in monthly tax revenues it collects on behalf of the Palestinians, has plunged the West Bank and Gaza into a financial crisis.
To try to get around Hamas, the EU and its three partners in the so-called Quartet of Middle East negotiators - Russia, the United States and the United Nations - decided last week to try to funnel aid through a temporary trust fund. Abbas welcomed that decision.
"I would like the mechanism approved by the Quartet last week implemented as soon as possible so we can avoid this catastrophe," Abbas told a news conference after his speech.
The fund would be held by an international organization such as the World Bank, the International Monetary Fund or the United Nations and jointly controlled by the Quartet members to avoid direct contact with Hamas.
'Explosion of anger'
Abbas said a prolonged suspension of international aid and Israeli tax transfers would leave 160,000 public sector workers without salaries in Gaza and the West Bank.
"Life will be frozen and then there will be an explosion of anger and this would lead to a chaotic situation of which we cannot foresee the results," he said.
"Don't allow the Palestinian people to reach such a level," he added in an appeal to the EU. "Even if there is a government that does not meet international requirements, you should not punish the people."
"I have asked the new government to amend its platform in order to conform to these international commitments," Abbas told the EU parliament. "We are in a continued dialogue that will take us to an expanded national dialogue in a few days. I hope that this will lead us to the required process of amendment."