I believe the Palestinians want Palestine recognized as a state and are prepared to live in peace. Israel wants peace too but only on conditions. I also think Israel does not want Palestine as a neighbor but would prefer a system of reservations for Palestinians which they could call any name they like.Sadly neither party wants 2 states, or peace.
So you ignore the well published and much touted palestinian demands for pre conditions before they will even meet. Demands that are illegal and unworkable to such an extent that even the UN finds fault with then.
It is already recognised as a state, what it wants is the world to lavish it with money so they wont start a terrorist war that will spread. They dont want to work and earn their place in society, they want to be free loaders