As US emissary George Mitchell was making the rounds in Jerusalem Thursday and reaffirming President Barack Obama's commitment to Palestinian statehood, Israeli ministers were distancing themselves from a two-state solution. "The preferable course of diplomatic action at this time is two economies for two peoples and not two states for two peoples," Interior Minister Eli Yishai said. "The American emissary also knows that forcing the region into virtual diplomatic discourse will only breed the opposite results." Speaking to Army Radio, Yishai expounded on the "economic peace" propounded by Prime Minister Binyamin Netanyahu, saying, "It would be more correct to create trust through economic discourse which is essentially a Palestinian interest." By "enlisting" to aid the recovery of the Palestinian economy, he said, the international community would also be helping the Palestinian public "relinquish terror." Earlier, Transportation Minister Yisrael Katz rejected the Annapolis process and said that Israel would not accept a two-state solution as the basis for talks. "The Annapolis outline has failed and is no longer binding," Katz said in an interview with Israel Radio, emphasizing that Netanyahu would "formulate a diplomatic approach that takes into account all of the different elements, and first and foremost Israel's security." Commenting on a statement by Egypt's Foreign Minister Ahmed Aboul Gheit, who said on Wednesday that Cairo would not work with Foreign Minister Avigdor Lieberman, Katz stated that the government would do "everything it takes" in order to safeguard Israel's "strategic relationship" with Egypt. He admitted that certain remarks made by Lieberman in the past, including a comment that Egyptian President Hosni Mubarak could "go to hell" if he did not agree to make an official visit to Jerusalem, were "unfortunate," but said he would not recommend an apology on the part of the foreign minister. Responding to Katz's comments, MK Yuli Tamir (Labor) said that "it is rapidly emerging that the government has no understanding of our international context and is putting us on a collision course with Europe and the US. The entire world supports Annapolis while Israel alone singles itself out as a dissenter."