In Ramallah – the de facto Palestinian capital of the occupied West Bank – many fear Western recognition of Palestinian statehood is too little, too late.

“I’m really glad that there are people who can see our suffering in Palestine and understand the problems we’re going through,” says Diaa, 23, who did not want to give his full name.

“But while recognition is important, what we really need are solutions.”

This city is home to government buildings, diplomatic missions, and a sprawling presidential palace.

But for many Palestinians, the dream remains that East Jerusalem – just a few miles south but largely cut off by Israel’s separation barrier – could become their capital under a two-state solution, which would create an independent Palestine in the West Bank and Gaza Strip, alongside Israel.

It is with that stated goal that the UK, France, Australia, Canada, Portugal, Belgium, Malta, Luxembourg, Andorra, and Monaco announced formal recognition of the State of Palestine at the UN General Assembly in New York this week.

“Recognition is a positive after all this time,” says Kamal Daowd, 40, on a busy Ramallah street. “But without international pressure it will not be enough.”

“If recognition comes without giving us our rights,” he says. “Then it’s nothing more than ink on paper”.

Israel has labelled the Western move a “reward for terrorism”. Prime Minister Benjamin Netanyahu reiterated on Sunday “there will be no Palestinian state” – while ultranationalists in his governing coalition went further, repeating calls for Israel to annex the West Bank outright.

“The only response,” wrote far-right Finance Minister Bezalel Smotrich, is “the removal of the foolish idea of a Palestinian state from the agenda forever.”

The UK and Germany say they have warned Israel against annexation, while UN Secretary General António Guterres told Monday’s conference it would be “morally, legally and politically intolerable”.

Israel has built about 160 settlements housing 700,000 Jews since it occupied the West Bank and East Jerusalem during the 1967 Middle East war. An estimated 3.3 million Palestinians live alongside them. The settlements are illegal under international law.

In the almost two years since the Hamas-led attack on southern Israel that killed about 1,200 people and saw 251 taken hostage, triggering the war in Gaza, Israel has tightened its control over the West Bank.

It has targeted pockets of armed Palestinian resistance at refugee camps in the north, carrying out major military operations and large-scale building demolitions, displacing many people from their homes.

Up and down the territory, hundreds of new Israeli military checkpoints have sprung up, often accompanied by sudden road closures. Palestinians say short journeys can now last hours.

The Palestinian Authority (PA), which governs parts of the territory not under Israeli control, has been placed under a long-term economic siege, with Israel withholding the tax revenues it needs to pay teachers and police. Salaries have been halved, and some staff ordered to work only two days a week.

Jewish settlers have ramped up attacks against Palestinians, and established scores of new outposts without Israeli government authorisation.

And at the same time, the Israeli government has launched a major settlement push, including the vast E1 project near Jerusalem, which would build 3,400 homes for settlers. Rights groups say it would effectively split the West Bank in two, destroying hopes of a contiguous Palestinian state.

“Whoever in the world is trying to recognise a Palestinian state today will receive our answer on the ground,” Smotrich said last month. “Not with documents nor with decisions or statements, but with facts. Facts of houses, facts of neighbourhoods.”

Previous visions of a two-state solution have involved land swaps. In 2008, then-Israeli Prime Minister Ehud Olmert tabled a plan at talks with PA President Mahmoud Abbas that would see Israel cede control of 4.9% of its land in return for an equal amount of Palestinian land in the West Bank.

The plan was never agreed, and 17 years later settlements have spread so deep into the West Bank that Palestinians fear the map has become too fragmented for a viable state.

As for Gaza, the devastation is immense. More than 65,000 Palestinians have been killed during Israel’s military campaign, according to the territory’s Hamas-run health ministry, and most of the 2.1 million population has been displaced.

The UN estimates 92% of housing units have been damaged or destroyed, 91% of schools will require full reconstruction or major rehabilitation, and 86% of cropland is damaged. It is thought reconstruction of the territory would cost more than £45bn over the next 10 years.

“Everyone is tired, everyone is exhausted, everyone is losing hope that the international community is going to be influential in solidifying the recognition,” says Sabri Saidam, a senior member of Fatah, the PA’s largest faction.

But does he still believe a Palestinian state can come into existence?

“If I did not believe that, we would not have put so much energy into the recognition,” he says. “It is time to convince the American administration that history has changed.”

That may be difficult. The US state department barred more than 80 Palestinian officials – including President Abbas – from attending this week’s UN General Assembly, accusing them of “undermining prospects for peace” by seeking “the unilateral recognition of a conjectural Palestinian state”.

For ordinary Palestinians like Diaa, the situation feels increasingly bleak. “People feel that the national dream is almost impossible,” he says.