If all goes according to Barack Obama’s plan, there will be a Palestinian state within two years. Relative to the 60 years of Palestinian suffering, that is an extremely short period of time. Despite this, there has been little enthusiasm shown for the plan from either Palestinians, Israelis or the Arab world. This is hardly surprising.

The world has been seeking to establish a Palestinian state since one ceased to exist, all to little avail. Emotions such as hope have long since been forgotten outside the speeches of politicians. In its place have emerged mutual distrust and cynicism, but also a grim determination to achieve a peace that has always seemed just out of reach.

Despite the near universal desire for peace and, in particular, a two-state solution, almost all of the progress made in the peace process has been at the negotiating table and not on the ground. This is the problem. A Palestinian state and an end to decades of hostilities will not be achieved as a result of hammering out joint statements and agreed frameworks.

The fighting will end and Palestinians will have a homeland to call their own once Israelis stop believing that their existence is being threatened and the Palestinians have the institutions in place to run a functional state. Progress on either of these issues will complement progress on the other and this is where effort should be focused.

There is scant evidence that the Israelis will become less paranoid. Benjamin Netanyahu gave a speech on Thursday stating that Israel will not be “suckers” in negotiations. Mr Netanyahu and his like-minded members in the Knesset view their country’s withdrawal from the Gaza Strip as a mistake that paved the way for a Hamas takeover. In the absence of a strong Palestinian government, so the argument goes, Hamas rose to prominence as a viable alternative to a weak and corrupt Fatah party. Israel’s intransigence on the settlement issue stems from a similar line of reasoning. But the problem is compounded by the composition of the current government, an amalgam of right-wing parties, many of whom are beholden to the settler movement for political support.

Thankfully, there have been positive developments on the Palestinian side. While Mahmoud Abbas rightly has dug in his heels on demanding a settlement freeze, an Israeli obligation under the road map to peace, the Palestinian Authority has shown an increased ability to manage security and its own affairs. Salam Fayyad, the Palestinian prime minister, has stated that his government plans to create all that is needed to run a functioning state within two years, a so-called “de facto state”. Mr Fayyad plans to make Israeli intransigence the only barrier to Palestinian statehood.

This would be a much-needed breakthrough. Israel often overstates the detrimental effects of an ineffective counterpart government, but there is certainly much room for improvement on the part of the Palestinians. There would be no greater confidence builder that the Palestinians could offer than to provide effective governance to their people.

Much has been made of the so-called “facts on the ground” that Israel puts in place to hamper the peace process. Palestinians should respond with their own facts that make peace a possibility. Peace cannot be forced from the top down alone; it must also grow naturally from the bottom up. Mr Fayyad and Mr Obama may need Israeli concessions to forge a final deal, but their actions beforehand will help shape that deal.