Israeli Prime Minister Benjamin Netanyahu is asking Canada to play a role in reviving the Mideast peace process.

Canadian Foreign Affairs Minister John Baird met Tuesday evening with Mr. Netanyahu, who only hours earlier hosted U.S. Secretary of State John Kerry in his latest shuttle-diplomacy visit to rekindle peace talks.

Mr. Netanyahu asked Mr. Baird to consider what role Canada – a staunch Israel ally – might play in the peace process as it develops, Canadian government sources said. In a statement, Mr. Netanyahu said he "welcomed Mr. Baird's offer of assistance" to advance talks.

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While there were no specifics on what part Canada could play, Mr. Netanyahu's talks with Mr. Baird included discussions on possible Canadian economic-development initiatives in the Palestinian territories. Those programs are aimed at boosting the economy and day-to-day lives of Palestinians in the hope of building the conditions for a lasting peace deal.

"We did a lot of listening – in Ramallah and Jerusalem," Mr. Baird said after the meeting. "I'm going to reflect on what I heard, take it back to Ottawa and discuss with my colleagues what role Canada can play."

The Harper government sympathizes with Mr. Netanyahu's insistence that he needs strong security guarantees and recognition of Israel as a Jewish state, and is skeptical that the Palestinians, divided between Palestinian President Mahmoud Abbas's moderates in the West Bank and militant Hamas rule in Gaza, will be willing to move now to negotiate such a deal. But Mr. Baird has expressed support for Mr. Kerry's effort, and suggested he favours economic initiatives to improve the day-to-day lives of Palestinians as a means to increase their stake in an agreement.

Mr. Netanyahu also expressed his concern to Mr. Baird that Israel will face a challenge in reaching a deal that provides real security guarantees – and gives confidence that it will have not only an agreement, but lasting peace afterward, aides said.

Mr. Netanyahu entered his earlier meeting with Mr. Kerry saying he's determined to resume the peace process, and the two men indicated that the plans to revive talks includes economic-development initiatives for Palestinians. But Mr. Kerry's shuttle-diplomacy has not yet brought Israelis and Palestinians to new negotiations. Mr. Netanyahu has not accepted Mr. Abbas's condition that Israel stop all settlement activity.

Still, before meeting Mr. Kerry, the Israeli Prime Minister called the attempts to revive the talks a "real effort" that he hopes to advance. "I'm determined not only to resume the peace process with the Palestinians but to make a serious effort to end this conflict once and for all," he said.

Mr. Kerry has been tight-lipped about his proposals, said to revolve around elements of a 2002 Arab peace plan, combined with economic initiatives aimed at providing a better climate for peace talks. He insisted those economic initiatives are only one component to his proposals, and not a substitute for negotiations. But the emerging economic second-track of the Kerry peace plan fits closely with ideas Mr. Baird has highlighted for potential Canadian action.

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Mr. Baird, wrapping up a 12-day tour to the Middle East before heading to London for meetings with G8 foreign ministers, spent much of Tuesday shuttling to meetings with party leaders in Mr. Netanyahu's new coalition in an attempt to gauge the dynamics in the new government, and their support for negotiations with Palestinians.

Earlier, Israeli President Shimon Peres also said he wants to see Ottawa play a role in a revived peace process, noting that Canada chaired multilateral talks on Palestinian refugees. Those talks have been dormant for years – and Mr. Peres suggested it might be time to revive them.

On Saturday, in talks with Mr. Baird, Palestinian Authority Prime Minister Salam Fayyad put economic-development initiatives, especially boosting the private sector in the West Bank, at the top of Palestinian priorities in discussions toward a new Canadian aid package. Mr. Baird discussed the Palestinians' aid priorities and said he would work on details and take a proposal for a new multiyear aid program to the federal cabinet. The last five-year plan was a $300-million package.

Mr. Baird said Canadian aid projects, notably in justice and security, have made a visible impact in Ramallah and the West Bank, and called them "an effective use of development dollars."

Mr. Baird has expressed staunch support for Israel throughout his visit to the country, and repeatedly called on talks to resume without preconditions – in effect, a call for Mr. Abbas to drop his demand that Israel stop settlement activity in the West Bank before he will return to peace talks.