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Acting President Dalia Itzik invited Hezbollah to begin negotiations with Israel on a 'fair exchange' for the release of the two soldiers kidnapped last summer. She also called on Hezbollah to show Israel some sign of life from the two kidnapped Israel Defense Forces soldiers Eldad Regev and Ehud Goldwasser.

Itzik was speaking at the official state ceremony yesterday marking the first anniversary of the Second Lebanon War, at Jerusalem's Mount Herzl National Cemetery. Regev and Goldwasser were abducted by Hezbollah on July 12 last year, sparking the war. Yesterday marked the first anniversary, according to the Hebrew calendar, of the onset of last summer's Second Lebanon War. Memorial ceremonies commemorating the war's fallen soldiers were held in Israel's north and in Jerusalem.

Defense Minister Ehud Barak said at the ceremony that Israel must restore its deterrence while keeping its hand outstretched for peace.

'The Second Lebanon War was first war since the War of Independence in which the home front was the battle front,' said the defense minister.

Barak also questioned whether the political leadership had done enough to prevent the outbreak of the war, as well as whether the IDF top brass had done enough to adequately prepare the army.

IDF Chief of Staff Gabi Ashkenazi also spoke at the memorial.

Amir Peretz, who served as defense minister during the war, attended the ceremony despite not being invited.

Yesterday's events began with a ceremony in Kfar Giladi, where 12 reservist soldiers were killed by a Katyusha strike on August 6. Several family members of the soldiers spoke at the ceremony, where they lashed out at Prime Minister Ehud Olmert for failing to attend any of the memorial ceremonies taking place.

Earlier in the day, members of the Knesset Foreign Affairs and Defense Committee from both sides of the political spectrum also slammed Olmert for refusing to participate in the memorial ceremonies.

'Not showing up to the ceremony does serious damage to the memory of the fighters, who went to war at your command,' MK Effi Eitam (National Union-National Religious Party) told Olmert.

MK Ran Cohen (Meretz-Yahad) described Olmert's decision as 'evading responsibility.'

Olmert noted that the ceremony was not a state event, and said the families would have to wait for hours to get through security if he attended. He defended the war, and accused the critical MKs of waging a political campaign under the guise of defending the families. Olmert also said he meets with bereaved families every week and takes care of their problems.