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Netanyahu Threatens to Retaliate if Palestinians Declare Statehood

Israeli Prime Minister Benjamin Netanyahu threatened to retaliate if Palestinians declare a unilateral state, saying such a move would unravel existing agreements with the Israelis.

Netanyahu’s stern comments come the same day that a senior Palestinian official told Fox News they are considering a U.N. resolution to declare a Palestinian state. Palestinian officials had said Sunday they were preparing to ask the United Nations to endorse an independent state without Israel's consent because they were losing faith in the peace talks.

But Netanyahu, speaking at the Saban Forum in Jerusalem, said there is “no substitute” for negotiations.

"Any unilateral action would only unravel the framework of agreements between us and can only lead to one-sided steps on the part of Israel," he said. He did not elaborate further.

The statehood idea appeared to be largely symbolic. The U.S., Israel's closest ally, would likely veto any initiative at the United Nations, and Israel controls the areas where the Palestinians want to establish their homeland. Nonetheless, the move reflected growing Palestinian frustration with the deadlock in peace efforts.

The Palestinians are upset over continued Israeli expansion of Jewish settlements in the West Bank and east Jerusalem and claim that the U.S. has not put sufficient pressure on Israel to halt the construction. The lack of progress has led Palestinian President Mahmoud Abbas to threaten to quit politics.

Abbas, who enjoys strong international support, had threatened to step down after a presidential election set in January. But last week, election officials postponed the vote indefinitely, saying that the Hamas militant group's control of the Gaza Strip made it impossible to proceed. In the West Bank Sunday, officials in Abbas' Fatah Party said they would meet next month to extend his term indefinitely.

Chief Palestinian negotiator Saeb Erekat said frustrated Palestinians had decided to turn to the U.N. Security Council after 18 years of on-again, off-again negotiations with Israel. The Palestinians seek an independent state that includes the West Bank, Gaza Strip and east Jerusalem — areas captured by Israel in the 1967 Mideast war.

"Now is our defining moment. We went into this peace process in order to achieve a two-state solution," he said. "The endgame is to tell the Israelis that now the international community has recognized the two-state solution on the '67 borders."

The U.S. has been trying to restart peace talks since President Obama took office last January. Netanyahu has urged the Palestinians to negotiate with him. But they refuse, saying Netanyahu must first stop settlement construction. Netanyahu has offered only a partial settlement freeze and refuses to endorse the 1967 lines as the basis for an agreement.

Even if the U.N. endorses the Palestinian idea, it would be virtually impossible to implement while Israel remains in control of the West Bank and east Jerusalem. Some 300,000 settlers live in the West Bank, in addition to 180,000 Israelis living in Jewish neighborhoods built in east Jerusalem. Thousands of Israeli troops continue to operate in the West Bank.

The Palestinians already declared independence unilaterally on Nov. 15, 1988. The declaration was recognized by dozens of countries, but never implemented on the ground.In the meantime, the Palestinian prime minister, Salam Fayyad, has begun a two-year development plan meant to lay the groundwork for independence.

Speaking in the West Bank, Fayyad said his development efforts are separate from the independence plan. He said his government's goal is "getting ready for statehood," while the Palestine Liberation Organization would decide when to declare independence.

Fayyad spoke at a news conference with U.S. Senator Joseph Lieberman, who praised Fayyad's efforts to develop the economy. The Connecticut lawmaker did not comment on the independence plan.

Erekat declined to say when the Palestinians would make their appeal to the U.N, signaling that the threat may be aimed in large part at putting pressure on Israel.

Israeli Defense Minister Ehud Barak warned that Israel risks watching the international community line up behind the Palestinians if negotiations are not restarted. "Without an agreement, there is a possibility that support will increase for the Palestinians declaring a state unilaterally," he told the Cabinet Sunday.

Nimr Hamad, an adviser to Abbas, said the Palestinians "have no intention of rushing" to the Security Council.

"We are going to have to prepare for this well and to hold political and diplomatic talks. We want the Security Council to discuss this only after we've been given assurances," he told the Israeli daily Maariv. "There is no point in rushing just so that we collide with an American veto."

As one of the five permanent members of the Security Council, the U.S. wields veto power over any resolution. Israeli media predicted that the U.S., Israel's key ally, would veto the move.Hamad said Abbas would travel to Cairo Wednesday to discuss the plan with Egyptian President Hosni Mubarak.

There was no immediate reaction from Security Council members. But Erekat said Russia, another permanent member of the Security Council, and unspecified European nations are "on board" with the Palestinian plan.

Fox News' Reena Ninan and The Associated Press contributed to this report.