The Palestinian Authority and the Arab world have recently been floating the idea of unilaterally declaring Palestinian statehood in the case that peace talks fail. Seeing as how the talks are looking ever more perilous, an analysis of this scenario – or the likelihood of the PA following through on their threat – seems warranted.

Over one year ago, Palestinian Prime Minister Salam Fayyad presented a two-year plan to build up the essential infrastructure needed for the establishment of a de facto Palestinian state, and once that is in place, to declare statehood in 2011. Fayyad’s plan received a lot of attention from those observing the conflict (NGOs, journalists, think tanks and analysts), but up until now the plan was dismissed in nearly all official channels. In fact, Palestinian Authority President Mahmoud Abbas outright rejected the plan in April of this year. However, in this month’s emergency meeting of Arab League ministers on the stalled peace process, Abbas said that if the talks fail, he might ask the UN Security Council, the US or the EU to recognize Palestinian statehood. With Fayyad’s 2011 goal for statehood rapidly approaching, one must ask whether the PA has rethought the strategic value of the Fayyad plan.

There was another recent development in the world that the PA leadership and Arab League members surely considered before making their threat to unilaterally declare statehood. In 2008, Kosovo declared itself a sovereign and independent state. The US, Britain, France, Germany, and Italy recognized Kosovo’s independence the very next day; 65 other countries followed suit. Although Kosovo has not been admitted to the United Nations as a member-state, in July of this year, the UN’s International Court of Justice ruled that Kosovo’s declaration of sovereignty and independence was valid. It is likely that the Palestinians understood this ruling to be a green light for their own national project. At the very least, they saw it a sign of the tides changing in international law, being more permissible of contemporary declarations of self-determination and statehood.

In the scenario that peace talks fail and the Palestinians make good on their threat of declaring statehood, and in the wake of the ICJ’s Kosovo decision, the Palestinians still have several hurdles to effectively establishing a state without Israeli cooperation. International law defines three preconditions for statehood: defined territory; a permanent population; and an effective government. While there are no established or defined borders for a future Palestinian state, the long-recognized state of Israel shares the same undefined border – in fact, Israel also has undefined borders with two other countries (Syria and Lebanon). Regarding a permanent population, little doubt can be cast upon the Palestinians meeting this condition. The establishment of an effective government is the condition that could be questioned the most. This is most likely the logic behind Fayyad’s plan to create state institutions in preparation a declaration of statehood. Although there is no unified Palestinian government, and the PA does not have any effective control over the Gaza strip, establishing a Palestinian state in the West Bank (as a starting point) might just be enough to begin working towards their goal of a sovereign state that encompasses both territories.

In reality, a declaration of statehood by the Palestinians would not result in any immediate “on the ground” changes. It would, however, drastically alter the international attitude towards two-state negotiations. The Palestinians see such a scenario as an alternative starting point for negotiations with Israel – one where they are at more of an advantage due to the unpredictable increase in international pressure on Israel. Instead of holding negotiations with a goal of statehood, they would be negotiating the characteristics of an already-established state, one likely recognized by a significant number of countries (the Arab League has 22 member states, the Organization of the Islamic Conference has 57 member states). The Palestinians would have a much stronger position in such negotiations.

Yet another issue is how a unilateral Palestinian declaration of statehood would affect the international community. While there are already two camps in the international community’s approach to the Israeli-Palestinian conflict, a unilateral declaration would polarize the UN, serve to partially isolate the US (who is sure to oppose such a move), and create a situation where the Arab world is once again pitted against much of the West. Very few countries in the world would like to see how this situation might play out.

So are the recent threats coming from Ramallah a way of pressuring Israel to compromise or capitulate to more of their demands, or are they signs of an actual contingency plan? Signals coming from top PA officials in recent weeks indicate that they have little faith in the talks succeeding. Palestinian head negotiator Saeb Erekat on Friday said, “He [Netanyahu] continues to take every possible step to prevent the establishment of a sovereign Palestinian state.” Erekat continued, “It seems to me that Netanyahu has made his choice: settlements over peace.” If the Palestinians don’t believe that Israel is genuine in its efforts to make peace – and by default, facilitate the establishment of a Palestinian state – then it is likely that their threats are real and represent a contingency plan in the works.

This scenario leaves one large and immensely significant question: How will Israel and the international community react to, or try and prevent this situation from taking place?