Israel must take heed of Palestinian Authority President Mahmoud Abbas’ threats to resign and dismantle the PA, a UN official who is close to the PA president told Haaretz, adding that the deadlock between Israel and the Palestinians could cause violence to erupt in the West Bank, and the rest of the world will not bail out Israel if that happens.

"The Palestinians feel growing alienation towards the Oslo process," said Robert Serry, the UN special coordinator for the Middle East peace process. "I hear many voices in Ramallah that call for the dismantling of the PA and to throw the keys back to Israel."

"I don't want to sound apocalyptic - but if things go wrong don't expect the international community to bail you out," Serry said in an interview with Haaretz on Friday in his office in the UN headquarters in Jerusalem. "We will not pay the bill."

Of the foreign diplomats serving in Israel and the PA, Serry, who is from the Netherlands, is considered one of the closest to Abbas. The Mideast envoy, who also serves as the UN secretary-general's personal representative to the Palestine Liberation Organization and the Palestinian Authority, meets with Abbas almost every week, and like other diplomats, Serry has heard from Abbas that he intends to resign within a few months if no progress is made in negotiations.

Serry warned that violence could erupt in the West Bank.

"It is a sad and paradoxical situation," said Serry. "On the one hand the Palestinians made progress in their state-building, but on the other hand, because there are no negotiations, and not only because of Israel's fault, the Palestinians are starting to wonder if this [two-state solution] should be the direction. This trend should worry the Israeli government and the Israeli public. If things will stay like this - the good security situation [in the West Bank] will not continue."

At a Fatah Revolutionary Council meeting in Ramallah on Wednesday, Abbas called on the council to consider dismantling the Palestinian Authority. After three days of debate, the Fatah leadership decided to establish a committee to discuss "the future of the PA in light of the continued Israeli occupation."

Israel should take Abbas' comments to heart, Serry said.

"Abbas is a wise man and he is committed to non-violence and to the two-state solution, but even he starts to think that it might be impossible," said the UN official. "You need to take Abbas' words seriously. Israel must not treat it as empty threats. If there will be no hope, it might turn out to be a self-fulfilling prophecy."

Time after time during the interview, Serry said he wanted to speak to the Israeli public: "On the surface the Israeli public thinks that the situation is good because there is no violence. But in order for the Palestinian leadership to continue to be committed to the security coordination with Israel, there has to be a political horizon. Otherwise it will be impossible."

"If people think that now it is just a bad period and that in the future we will renew the negotiations," he added, "it is an illusion."

On Wednesday, Serry, who has served in his UN posts since 2007, participated in Quartet meetings with Prime Minister Benjamin Netanyahu's adviser Isaac Molho and the head of the Palestinian negotiating team, Saeb Erekat. The meetings were a last-ditch attempt to restart the peace process and stop the Palestinians from seeking statehood through the United Nations.

Serry said he feels the Israeli public and the Netanyahu government are not paying enough attention to the despair coming from Ramallah.

"I think that the Israeli public has complicity in the situation," said the UN official. "You think that this can go on. I doubt it. Israel's character as a Jewish state is in danger. I am here four years and I see how you are continuing to build the settlements. You and the Palestinians are becoming Siamese twins. It will be impossible to separate you. Only separation will make the vision of a Jewish state for the Jewish people possible."

Abbas was greatly hurt by Foreign Minister Avigdor Lieberman's comments calling him the "greatest obstacle" to regional order and statement that it would be a "blessing" if the Palestinian leader were to resign, Serry said.

"We spoke to both sides about the need to refrain from provocations - you can make your own conclusions," he said.

The Quartet's most recent efforts to conduct talks with Israel and the Palestinians separately, based on a preset schedule, is more significant than it looks, said Serry.

"I am involved in those talks," he said. "We made clear to both sides that the next 90 days are for preparing serious proposals on borders and security. The clock is ticking. I hope both sides understand that the stakes are high."

Despite the deep lack of trust between Netanyahu and Abbas, the Quartet's talks with the two sides could allow them to hold "quiet talks" of their own.

"I am aware of the obstacles that exist," said Serry. "I hope both sides will use the situation to start quiet talks. We shouldn't expect immediate progress. We didn't hear new things from the parties in the meetings with the Quartet. But both sides said they are committed to the process and to the timetable. Maybe now we will be able to get to direct talks - even on a quiet track."

Serry spoke of how he and his staff have played a behind-the-scenes role in recent years in the contacts for the release of Gilad Shalit: "When the German negotiator came to Gaza for the first time, we were the ones that introduced him to Hamas."

He called the Shalit deal a positive development, but said now Israel must act to strengthen Abbas and should consider handing over additional parts of the West Bank to be placed under Palestinian control.

"The Israeli government should consider transferring parts of Area C to Palestinian control and to plan the second phase of the Shalit deal prisoner release in favor of Abu Mazen," said Serry, referring to Abbas.

"I have good contacts in the Israeli defense establishment and they understand the bad consequences," he said. "They understand that after the Shalit deal they need to reach out to Ramallah. There has to be concrete steps regardless of negotiations."

Serry and his staff also warned of the "price tag" revenge attacks on Arabs carried out by some West Bank settlers.

"Price tag is very concerning," he said. "The Israeli government distanced itself from those actions and condemned them, but often those who commit them are not caught and are not brought to justice, and this is worrying."