UNITED NATIONS (Reuters) - The U.N. General Assembly is set to approve an implicit recognition of Palestinian statehood on Thursday despite threats by the United States and Israel to punish the Palestinian Authority by withholding funds for the West Bank government.
A resolution that would lift the Palestinian Authority's U.N. observer status from "entity" to "non-member state," like the Vatican, is expected to pass easily in the 193-nation General Assembly. At least 15 European states plan to vote for it.
Israel, the United States and a handful of other members are set to vote against what they see as a largely symbolic and counterproductive move by the Palestinians, which takes place on the 65th anniversary of the assembly's adoption of resolution 181 on the partition of Palestine into Jewish and Arab states.
Granting Palestinians the title of "non-member observer state" falls short of full U.N. membership - something the Palestinians failed to achieve last year. But it would allow them access to the International Criminal Court and other international bodies, should they choose to join them.
"The ICC issue is what the Israelis are really worried about," a U.N. official said on condition of anonymity. "They know this whole process isn't really symbolic except for that."
Palestinian President Mahmoud Abbas has been leading the campaign to win support for the resolution, which follows an eight-day conflict this month between Israel and Islamists in the Gaza Strip, who are pledged to Israel's destruction and oppose his efforts toward a negotiated peace.
The U.S. State Department made a last-ditch effort to get Abbas to reconsider, but the Palestinian Authority, which exercises limited self-rule in the Israeli-occupied West Bank, gave no sign that it was turning back.
Secretary of State Hillary Clinton repeated to reporters in Washington on Wednesday the U.S. view that the Palestinian move was misguided and efforts should focus instead on reviving the stalled Middle East peace process.
"The path to a two-state solution that fulfills the aspirations of the Palestinian people is through Jerusalem and Ramallah, not New York," she said. "The only way to get a lasting solution is to commence direct negotiations."
Acknowledging strong European support for the Palestinians, Clinton said on Thursday: "We and our European partners agree on the most fundamental issues and share a common objective - two states living side by side in peace and security."
Speaking at an annual U.N. event in support of the Palestinians, Palestinian Foreign Minister Riyad al-Maliki appealed to U.N. member states to support Thursday's U.N. resolution. He also repeated his support for peace with Israel.
"Despite diminishing hopes and the decline of the situation on the ground due to Israel violations, we remain committed to the two-state solution and our hand remains extended in peace," he said at U.N. headquarters in New York.
State Department spokeswoman Victoria Nuland reiterated U.S. warnings that the move could cause a reduction of U.S. economic support for the Palestinians. The Israelis have also warned they might take significant deductions out of monthly transfers of duties that Israel collects on the Palestinians' behalf.
PALESTINIANS RALLY IN WEST BANK, GAZA
Despite its fierce opposition, Israel seems concerned not to find itself diplomatically isolated. It has recently toned down threats of retaliation in the face of wide international support for the initiative, notably among its European allies.
"The decision at the United Nations will change nothing on the ground," Israeli Prime Minister Benjamin Netanyahu said in Jerusalem. "It will not advance the establishment of a Palestinian state. It will delay it further.
But U.N. diplomats say that Israel's reaction might not be so measured if the Palestinians seek ICC action against Israel on charges of war crimes, crimes against humanity or other crimes the court would have jurisdiction over.
Russian Deputy Foreign Minister Mikhail Bogdanov was quoted by the Interfax news agency as calling on Washington and Israel to avoid "any hasty and destructive decisions."
"Supporting the Palestinian authorities is not only in the interest of the Palestinian side, but also of Israel and the whole international community that is longing for a peaceful political settlement," he said.
The European Union, a key donor for the Palestinians, has made clear it will not curtail aid after Thursday's vote.
Flag-waving Palestinians thronged the squares of the West Bank and Gaza Strip before Thursday's vote. In a rare show of unity, Abbas's Islamist rivals Hamas, who have ruled Gaza since a brief civil war in 2007, let backers of the president's Fatah movement hold demonstrations there.
Peace talks have been stalled for two years, mainly over Israeli settlements in the West Bank, which have expanded despite being deemed illegal by most of the world. There are 4.3 million Palestinians in the West Bank and Gaza.
In the draft resolution, the Palestinians have pledged to relaunch the peace process immediately following the U.N. vote, expected sometime after 3 p.m. (2000 GMT) on Thursday.
With strong support from the developing world that makes up the majority of U.N. members, it is virtually assured of securing more than the requisite simple majority. Palestinian officials hope for more than 130 yes votes.
Abbas has focused on securing as many votes as possible from Europe, and his efforts appear to have paid off.
Austria, Denmark, Norway, Finland, France, Greece, Iceland, Ireland, Italy, Luxembourg, Malta, Portugal, Spain, Sweden and Switzerland all pledged to support the resolution. Britain said it was prepared to vote yes, but only if the Palestinians fulfilled certain conditions.
The fiercely pro-Israel Czech Republic was planning to vote against the move, dashing European hopes of avoiding any no votes that would create a three-way split on the continent into supporters, abstainers and opposers.
It was unclear whether some of the many undecided Europeans would join the Czechs. Germany, Hungary, the Netherlands, Estonia and Lithuania plan to abstain.
(Andrew Quinn in Washington, Noah Browning in Ramallah, Jeffrey Heller in Jerusalem, Michelle Nichols in New York, Robert Mueller in Prague, Gabriela Baczynska and Reuters bureaux in Europe and elsewhere; Editing by Cynthia Osterman)