(CNN) Australian Prime Minister Scott Morrison announced Saturday that his government recognizes West Jerusalem as the capital of Israel.

"The government has resolved that Australia's position is now as follows: Australia now recognizes West Jerusalem as being the seat of the Knesset [Israeli parliament] ... West Jerusalem is the capital of Israel," he said in a speech at the Sydney Institute.

Morrison noted that for now, the embassy won't move from Tel Aviv, but that may change later.

"We look forward to moving our embassy to West Jerusalem, when practical, in support of and after a final status determination," he said. "We've decided to start the work there now, to identify a suitable site for an Australian embassy in West Jerusalem."

Scott Morrison noted that for now, the Australian Embassy won't move from Tel Aviv, but that may change later.

Morrison emphasized that a two-state solution is the only way to resolve the dispute.

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