The Israeli inquiry into the Gaza shooting by Israeli soldiers during which Maltese national Bianca Zammit was injured was progressing well, Israeli Foreign Minister Avigdor Lieberman said this morning.

Speaking to the media following a meeting with Foreign Minister Tonio Borg, Mr Lieberman said Israel regretted situations where civilians were injured.

However, he avoided answering questions as to whether Israel considered Ms Zammit's actions an act of provocation.

The case concerning Ms Zammit was earlier raised by Dr Borg in his talks with the Israeli minister. Dr Borg reiterated Malta's request to be informed of the outcome of the investigation and he hoped that this would be concluded as soon as possible.

In a statement, Dr Borg said that Malta was seriously concerned about the lack of progress in the Middle East peace process. It , however, welcomed however, the resumption of negotiations and augured that it would lead to a two-state solution within an agreed time-frame.

He reiterated the view that new settlements were an obstacle to the peace process and were creating unnecessary tension in the region. He also said that discussions on Jerusalem as the future capital of two states was also essential if there was to be genuine and lasting peace in the region.

Dr Borg welcomed the easing of of the blockade on Gaza,. which he described as unsustainable, and hoped this would lead to better living conditions for the people of Gaza.

On the recent events following the Israeli military operation on the flotilla sailing to Gaza, he underlined the importance of a credible and impartial investigation, including international participation.

Mr Lieberman described the flotilla as provocation. He said it was important for hte economy in Gaza to improve but there was no humanitarian crisis.

"There are expensive restaurants in Gaza which are always full. You can also see people with iphones," he said.

During this morning's meeting, the ministers also discussed trade exchanges and tourism. A Maltese trade delegation led by Malta Enterprise will visit Israel in the first quarter of next year.

Malta has also launched a tourism promotion drive on national newspapers and specialized magazines in Israel. Air Malta will start flying to Tel Aviv twice weekly from July 22 to September 30. Malta has been promoted as a hub for English language teaching.

Mr Lieberman then paid a courtesy visit to President George Abela at the Palace in Valletta.