By Alexandra Hudson
ISTANBUL (Reuters) - Turkey will never forget the nine Turks killed when Israeli troops stormed a Gaza-bound aid flotilla, Prime Minister Tayyip Erdogan said on Saturday, days before the submission of a U.N. report on the raid last year.
In a speech to a conference of foreign ambassadors to the Palestinian territories in Istanbul, Erdogan condemned the continuing blockade of Gaza as "illegal and inhuman" and said the Palestinians' troubles were Turkey's troubles and would not go neglected.
Erdogan opened his speech by naming each of the men killed in the raid on the Mavi Marmara ferry, which led the activists flotilla.
"We have not forgotten, nor will we forget, the self-sacrifice of our brothers, their memories and the massacre they were subjected to," he said.
Turkey withdrew its ambassador to Israel after the incident in May 2010, suspended military cooperation, and closed its airspace to Israeli military aircraft.
It wants Israel to apologize for the killings, pay compensation to the families, and end the embargo of Gaza.
For its part, Israel has agreed in principle to pay compensation, but says its marines acted in self-defense after an initial boarding party was attacked with knives and clubs.
It says the blockade is justified to prevent arms smugglers ferrying weapons to Hamas, the Islamist group which runs Gaza.
The United States would like its two allies to be friends again. But even if they reach closure on the Mavi Marmara incident, Turkey's sympathy for the Palestinian cause and readiness to engage Hamas will mean the relationship will not
be free of tension.
"We must find a solution to the Israel-Palestinian issue on the basis of a two-state model. East Jerusalem as the capital of an independent, sovereign and viable Palestinian state is what we desire," Erdogan told the conference.
He also called for a stop to Jewish settlement activities, which he said were the greatest obstacle to the peace process.
Israel sees Jerusalem as its undivided capital and annexed the eastern part of the city after a 1967 war, a move that has not gained international recognition.
Many settlers also consider the Israeli-occupied West Bank, as a biblical birthright of the Jewish people.
Palestinian President Mahmoud Abbas thanked Turkey for its support in his address to the conference.
Turkey's ties with Israel hit a nadir over the Mavi Marmara incident, but they first soured after Erdogan's public criticism of Israeli president Shimon Peres over an Israeli offensive in Gaza in 2009.
That outburst made Erdogan a hero on the Arab Street, and brought Turkey newfound respect in the region.
So far, the U.N. report into the Mavi Marmara has been signed only by the commission's chairman Geoffrey Palmer, a former prime minister of New Zealand, and vice chairman Alvaro Uribe, a former president of Colombia.
Whether panelists from Israel and Turkey sign depends on bilateral contacts to resolve differences before the report is submitted.
(Editing by Myra MacDonald)