UN Secretary-General Ban Ki-moon is worried by the collapse of the Middle East peace talks brokered by Jordan and by the Palestinians' drive for UN recognition. In an interview with Haaretz, Ban said he is concerned by possible damage to various UN institutions if the Palestinian Authority presses ahead with its membership requests to them. The stalled peace talks under the auspices of King Abdullah only started last month.

"The Palestinians' aspirations for a state must be realized as part of a negotiation process," Ban says, adding the aspiration to establish a sovereign Palestinian state is long overdue.

Open gallery view A shoe being thrown at a vehicle in the convoy of UN Secretary-General Ban Ki-moon as it arrives at Erez border crossing between Israel and Gaza February 2, 2012. Credit: Reuters

This is Ban's third visit to Israel and the Palestinian Authority, and the first during his second term as UN secretary-general.

While the Palestinians' bid for full UN membership is still stuck in the UN Security Council, the PA was received as a member in UNESCO. Consequently, the American administration cut back the organization's annual budget, causing immediate damage. Plans and projects were suspended, salaries were slashed and employees were fired.

The Palestinians are threatening to request membership in 16 other UN agencies, especially if the talks with Israel in Amman quagmire.

Ban and Palestinian Authority President Mahmoud Abbas, who met in Ramallah on Wednesday, spent a large part of the meeting dealing with this issue, UN diplomats said.

Ban told Abbas that continued bids for UN membership would harm the organization, due to further cuts in American funding.

On Thursday morning, on the sixth floor of the King David Hotel in Jerusalem, Ban was still worried.

"Admission of the Palestinians and funding of UN agencies are separate issues, but unfortunately they has been linked in practical terms and that is what I am very much concerned about," he said.

"At the same time, the aspiration of the Palestinian people to establish a viable and sovereign state is long overdue. I have been urging that these aspirations could be realized in the context of a two-state vision. That requires negotiations. Everything should be addressed in a negotiated process."

Asked whether the talks between Israel and the Palestinians are on the verge of breaking up, Ban said, "Israel and the Palestinians have wasted two years without moving forward. Considering what is happening in this region, this is the right moment for Israelis and Palestinians to agree on a better future for the two peoples.

"There is lack of confidence and mutual trust," Ban continued. "It is understandable because of this long-standing conflict. But to overcome this, they need to sit down and resolve this issue. This is a time when the leaders must show a vision of courage and determination."

A few minutes before the interview, Ban read a news summary his aides prepared for him. One of the items was about eight rockets fired at Israel from the Gaza Strip during the night.

An hour later, Ban was on his way to Gaza and Sderot. At the entrance to the Gaza Strip, he was met by Palestinian demonstrators, who threw shoes at his car.

Asked if he was worried Israel may launch another military operation in the strip, Ban said: "For many years I have been fully condemning those rocket attacks on civilians. This is totally unacceptable and against the fundamental principals of human rights."

Since the Turkish aid flotilla to Gaza in May 2010, Israel has removed most of the restrictions on merchandise, and even building materials, going into Gaza, after years of arguing that building materials would serve Hamas to build bunkers. UN agencies are building 2,000 housing units in Gaza. Israel has approved 170 UN projects there, including building and renovating 60 schools and kindergartens.

"I appreciate that Israel has allowed construction materials and other humanitarian goods to be shipped into Gaza," Ban said. "What is important is that all the restrictions imposed on Gaza are lifted unconditionally and completely. They have the right to live in peace and enjoy freedom of movement.

"I urge Israel to lift those restrictions completely," he added. "Those impositions in Gaza have generated illegal trade through tunnels. For a normal economy to work, this is not good."