The formation of an independent Palestinian state is the best way to ensure Israel's security and gain legitimacy in the eyes of its neighbors, Canada's Foreign Minister Peter Mackay said at the Herzliya Conference on Sunday. MacKay spoke at the conference immediately after meeting Prime Minister Ehud Olmert in talks that sources in Olmert's office said dealt more with Iran and Syria than with the Palestinians. Olmert thanked MacKay for the strong support Canada has shown or Israel over the last year, especially during the war in Lebanon. MacKay pointed out at the conference that Canada was the first government to cut off ties with the Hamas government when it took power last April, and that Canada has taken action in the UN against "unfair resolutions against Israel." He said that Canada "recognizes that Israel has a duty first and foremost to protect its citizens. But I want to point out that Israel's security depends on the Palestinians' ability to prosper in dignity. The increasing growth of settlements and settlement building in the West Bank is also a hindrance to this process." The foreign minister said that Canada believed in a two-state solution "for reasons of principle and practicality. In the current environment, critics will say, and will be right, that we have been at the brink of peace and it has fallen through. They will also say that conditions for peace have been better in the past and still nothing came of this. But there are new conditions that change the picture - the nuclear threat from Iran, threats in Lebanon and Iraq. Many Arab leaders from the Gulf to the Maghreb, Arab leaders are willing to help. And with the exception of a few extremists, there is an acceptance that Israel is here to stay." Regarding Iran, MacKay said that "Teheran must not be allowed to obtain nuclear weapons. We need to start talking seriously and creatively about what the international community can do and can do now and what resources we can draw upon." He said that Canada's relationship with Israel goes back to the beginning of the state, but admitted that the record was not "unblemished." "We were among those who turned our backs on Jews fleeing the Holocaust," he said. "But we have learned from our mistakes."