U.S. Boosting Efforts in Mideast Peace Talks

The United States is planning to step up efforts to help reach an elusive Middle East peace deal, having set an ambitious goal of sealing an agreement within nine months.

U.S. Secretary of State John Kerry revealed for the first time Wednesday that Israeli and Palestinian negotiators have now met directly seven times since the peace talks were relaunched in late July.

And he laid out some plans for trying to spur hopes that after decades of failure these talks may actually succeed and lead to the creation of two states, one Israeli and one Palestinian, living side-by-side.

"All of the issues are on the table, territories, security, refugees, Jerusalem, all of the final status issues are on the table," Kerry stressed, addressing members of the Ad Hoc Liaison committee dealing with Palestinian issues at a meeting at the United Nations.

He praised Israeli Prime Minister Benjamin Netanyahu and Palestinian president Mahmoud Abbas for agreeing to return to the negotiations after a hiatus of nearly three years.

"For these leaders to live up to the challenges of making peace, we all... have to live up to our obligations on the economic front."

U.S. special envoy Martin Indyk, a former ambassador to Israel who was appointed in July to shepherd the negotiations, has taken part in some of the seven rounds of talks so far.

"We've agreed now in the last week ... to intensify these talks and we've agreed that the American participation should be increased somewhat in order to try to facilitate them," he added, without elaborating.

Kerry said some things were already changing on the ground, following decisions by Israel to allow new construction materials such as steel and cement into the impoverished Gaza Strip, and to grant 5,000 new work permits for young Palestinians to travel to work in Israel.

A key transport route from the West Bank into Jordan, the Allenby Bridge, would also be opened up five days a week, 24 hours a day. And Israel was allowing more water and telecommunications equipment into Gaza.

Netanyahu "has bent over backwards to make things happen," Kerry told the committee.

U.N. chief Ban Ki-moon called on all donors to step up efforts saying "the situation is volatile and the status quo is not sustainable. In the long term it is damaging to both the Israelis and the Palestinians.

"We must do all we can to save the two-state solution," Ban insisted, adding "complacency only breeds more conflict."

U.S. President Barack Obama, who on Tuesday during his address to the U.N. General Assembly urged the world to take the risks needed to support the peace process, was also prepared to help the process along by consulting with Netanyahu and Abbas as needed.

The two sides have agreed to keep negotiating for some nine months, with the hope of having a deal at the end of it, some time towards late April or early May.

"Some people say it's too short a time to work it out. I don't think so," Kerry said.

"The fact is the two sides have been negotiating this for years. And we've seen us come this close. What this really needs, there's no secret about it ... a dose of courage and a reasonable level of compromise."

Norwegian Foreign Minister Espen Barth Eide, chairing the committee meeting, warned the Palestinian economy, which is heavily donor dependent, was slowing down.

The Palestinian deficit in 2013 was budgeted to be around $1.1 billion, but was more likely to be around $1.46 billion.

"This shortfall is adding $350 million to the already high levels of arrears and debts," Eide warned. "As donors we must do our utmost to reverse this trend and make the Palestinian economy sustainable."

The United States was working with banks to try to relieve the Palestinian debt, Kerry said.

It was also working with the Palestinian Authority to develop a scheme to encourage immediate investment in high impact micro infrastructure projects in the West Bank.

"We have directed $20 million into these types of projects, we are seeking $80 million and these can be started in the next months so that the Palestinians can see changes on the ground," Kerry said.