Martin McGuinness has said there are "challenges ahead for Irish republicans" if current problems with the peace process are to be resolved.

Sinn Fein's chief negotiator made his comments following a call by the Democratic Unionists for the IRA to disarm and disband immediately.

The DUP's Jeffrey Donaldson said it was the only way for Sinn Fein to return to government in Stormont.

Northern Ireland's political parties and the British and Irish governments are preparing for crunch peace process talks in Kent next month.

The aim is to restore the province's devolved institutions which have been suspended since October 2002.

Momentum will gather pace in the next few days when former US President Bill Clinton visits Belfast.

Northern Ireland secretary Paul Murphy will be meeting all the parties before the full talks get underway in September.

Murphy said there is a "definite seriousness" among all parties to see an end to direct rule.

The assembly can only be restored "if they resolve the underlying difficulties that divide them".

"I do believe Sinn Fein is serious about wanting to have a resolution of these difficulties," he added.

Republican concessions?

In a statement released on Tuesday McGuinness appeared to signal that the IRA might be prepared to make further concessions.

"Sinn Fein is committed to playing a full and productive role in resolving all of the outstanding issues, including issues of concern to unionists and we recognise fully that this means more challenges ahead for Irish republicans," he said.

The Mid Ulster MP and MLA conceded there were huge differences between his party and the DUP, which are respectively the largest nationalist and unionist representatives, but said there was hope of a breakthrough.

"It is a mammoth task but it has to be done sometime. Why not now? I am confident that if we apply our collective energy, experience and talent that we can be successful," he added.