A UN report on progress by the Palestinian Authority in building institutions released Tuesday assessed that "in six areas where the UN is most engaged, government functions are now sufficient for a functioning government of a state."

The report, prepared by UN officials for an upcoming meeting of the Ad Hoc Liaison Committee in Brussels, reviews progress in the implementation of the PA's August 2009 plan to build state institutions, which was backed by the AHLC and Quartet.

Launched in the summer of 2009, the plan, titled Ending the Occupation, Building a State, set forth a rigorous program of infrastructure and institution building in the West Bank.

United Nations Special Coordinator Robert Serry, whose office UNSCO prepared the report, reminded Tuesday that September - the target for the completion of state-building activities, "is also the target set by the parties to reach a negotiated permanent status agreement to create a Palestinian state at peace with Israel."

On Tuesday reports in Israel said its government was concerned of the increase in international legitimacy the idea of a Palestinian state had achieved, particularly efforts to secure recognition of a Palestinian state on the 1967 borders, inside which Israel refuses to halt settlement construction.

"The Palestinian state-building agenda are approaching their limits within the political and physical space currently available, precisely at the time when it is approaching its target date for completion," Serry commented, saying the next step in state building called for Israel to "roll back measures of occupation to match the PA’s achievements."

The official also called for sides to resume negotiations, which reached a stalemate in September when Palestinian requests that settlement construction on lands up for negotiations for a Palestinian state be halted.