There is a "steely resolve" to save Northern Ireland's power-sharing institutions, Ireland's foreign minister said.
Intensive political negotiations launched by the British and Irish governments are due to begin at Stormont next week.
It follows the shooting dead of a former IRA man in Belfast last month by individual members of the Provisional IRA. Police have insisted the group is not back on a war footing but the revelation that the organisation still exists has rocked the political establishment.
Irish Foreign Affairs Minister Charlie Flanagan said: "I have spoken in recent days to the leadership of the Executive parties. I have heard very clearly the hurt and frustration that they feel - all of them.
"But underneath that, I have discerned a deep and steely resolve to save the power-sharing institutions. Every party is 'up for talks' because - whether they are articulating it or not - every party knows what is at stake: the survival of the power-sharing institutions themselves."
The British Government has decided to legislate on welfare reform in Northern Ireland if the Stormont parties cannot reach agreement.
The DUP and Sinn Fein have been at loggerheads over the issue for months and the devolved administration in Belfast has been plunged into financial peril.
Mr Flanagan addressed a British/Irish conference in Cambridge ahead of the negotiations.
"There is undoubtedly a realisation that the consequences of failure would constitute a serious setback for the people of our island.
"And I know that my fellow politicians in Northern Ireland have invested too much in this project of transformation to allow it to fail.
"And so, it is incumbent of all of us to go forward in a spirit of positivity, knowing compromises and courage will be required from all participants."