The Palestinian Authority on Monday denounced threats to impose sanctions on the Palestinians in response to their effort to upgrade their status at the UN to that of a non-member state.Muhammad Shtayyeh, a member of the Fatah Central Committee who is closely associated with PA President Mahmoud Abbas, said he saw no reason why the Palestinians should be punished for embarking on a “peaceful and legitimate step.” His remarks came during a press conference at the PLO offices in al-Bireh.Also on Monday, Abbas headed to Saudi Arabia for talks on the UN statehood bid with King Abdullah and senior government officials.Abbas’s visit to Saudi Arabia comes as part of his efforts to secure Arab backing for his plan to ask the UN to upgrade the Palestinian status, a move that is seen as a de facto recognition of statehood.The UN General Assembly can’t grant the Palestinians full membership in the international body, but the upgrade will increase their rights and possibly allow them to pursue Israelis at the International Criminal Court.At the press briefing, Shtayyeh said that Abbas was scheduled to attend a meeting of Arab League foreign ministers in Cairo on Tuesday to seek their backing for the statehood bid, which he said would take place before the end of the month.The Fatah official said that all the Arab countries have promised to vote in favor of the Palestinian application to the UN General Assembly.“Going to the UN is a peaceful and legitimate step,” Shtayyeh explained. “We are going to an international organization that is a symbol for peace and security.”Israel has opposed the unilateral move, urging the Palestinians to return immediately to the negotiating table. It has warned that it is dangerous to the prospects of peace to separate the issue of Palestinian statehood from a negotiated twostate solution.Jerusalem has threatened to take retaliatory measures against the PA, should it make good on their pledge to head to the UN. Finance Minister Yuval Steinitz has threatened economic sanctions, including withholding tax fees.“We disapprove of the talk about sanctions. It is shameful to talk about sanctions. This is the first step toward political independence and the establishment of a Palestinian state with Jerusalem as its capital,” Shtayyeh said.He said that Palestinians could not understand the “frantic campaign” being waged against the PA’s statehood bid.“This is an insult to the UN because it is an organization that was established to defend peace and stability in the world,” he said. “It should be taken into consideration that Israel was established according to a UN resolution.”Shtayyeh said that Palestinians were being asked to choose between bread and freedom.“We want both,” he declared.“Yes, we want bread, but Palestinians are prepared to make big sacrifices to end the occupation and achieve freedom and independence.”However, Shtayyeh said that he did not expect Israel to impose financial sanctions on the Palestinians out of fear that such a move would lead to the collapse of the PA, which would mean chaos, he warned.“Israel will then pay the price,” he said.He described Israeli threats to withhold tax revenues belonging to the PA as “empty threats.” Shtayyeh said that Israel may delay payments to the PA, “but will not stop them. This could lead to the collapse of the PA and I don’t think that Israel would be able to bear the consequences.”According to the Fatah official, the “Palestinian train has already set on its journey and demands to prevent us from going to the UN are unjustified.”The decision to go to the UN is aimed at exerting pressure on Israel to stop its measures on the ground and return to the negotiating table, he said.On Sunday, Abbas rejected US President Barack Obama’s request to refrain from going to the UN, PA officials in Ramallah said. Obama made the request during a phone call with Abbas, the officials said.Obama stressed that he did not support the Palestinians taking unilateral steps at the United Nations.He made his comments after returning Abbas’s congratulatory message following Obama’s reelection last week. During the phone call, he referred to the “partnership” between the two leaders and his desire to continue their close cooperation.However, during the conversation, he reiterated the United States’ “opposition to unilateral efforts at the United Nations.”Obama also noted that he remains committed to finding Middle East peace and supports direct negotiations for a two-state solution as the path to that end.Chief PLO negotiator Saeb Erekat said on Monday that there were “big differences” between the PA and the US over the statehood bid.Erekat told the PA’s Voice of Palestine radio station that the US administration was threatening to impose severe financial sanctions on the Palestinians and close down the PLO office in Washington if the Palestinians insisted on pursuing their statehood bid.“We don’t want to clash with the US,” Erekat said. “But they must work to stop Israeli dictates, the terror of settlers and the Judaization of Jerusalem.”He said that the PA was taking the US threats seriously and consulting with the Arab countries about the statehood bid.Erekat said that the US had cut off funds to the PA about one year ago.“The Palestinian Authority hasn’t received financial aid from the US since the end of October 2011, when Palestine was admitted to UNESCO,” he disclosed.Hilary Leila Krieger and Tovah Lazaroff contributed to this report.