If the palestinians unilaterally declare independence, it will be the violation of all previously agreements they've signed stating the will negotiate a peace settlement. And if they violate all of these contracts, israel will have no option but to make its own unilateral movements, including annexing all of area C, not to mention a host of other actions.
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Livni: Shaked's annexation bill would lead to bi-national state with Palestinian majority in Knesset
from the article: Palestinians under world pressure not to declare state unilaterally