The French government has announced that it will support a resolution that would recognize a Palestinian state at the United Nations in a vote at the U.N. General Assembly this week. Palestine is currently an observer at the U.N. The resolution would recognize Palestine as a nonmember observer state.
As it stands the resolution is almost certainly going to pass despite objections from Israel and the U.S. When asked about the issue last week U.S. Ambassador to the U.N. Susan Rice said:
Our goal remains a negotiated, two-state solution. A Jewish democratic state of Israel living side by side in peace and security with an independent, viable Palestinian state. The only way to accomplish that in the real world is through direct negotiations, and we continue to urge the parties to come back to the table and to resume those direct negotiations. We view unilateral steps, including the bid for upgraded status to statehood—observer state status at the General Assembly—to be counterproductive and not take us closer to that goal, and, therefore, we strongly oppose it.
The US and Israel have both hinted at possible retaliation if the vote goes ahead. Congress could block payments to the Palestinian Authority and Israel might freeze tax revenues it transfers under the 1993 Oslo agreement or, worse, withdraw from the agreement altogether. It could also annex West Bank settlements. Britain's position is that it wants to reduce the risk that such threats might be implemented and bolster Palestinian moderates.