Of the multitude of documentaries made about the Israel/Palestine situation, few offer any reason for optimism. But a new film being shown at this week's Berlinale presents an unusually positive attitude, focusing on neither war nor suffering, but the foundations for future peace.

State 194, from the Emmy-winning Israeli filmmaker Dan Setton, follows the ambitious and widely applauded efforts in 2009 by the Palestinian prime minister Salam Fayyad to build the institutions of statehood in the West Bank. Shooting over two years, Setton's camera captured the physical transformation of several West Bank cities under Fayyad's policies, with roads paved, schools constructed and the core institutions of governance created. The film's title refers to later attempts by President Mahmoud Abbas to build on these achievements and to have Palestine recognised by the UN as the 194th member nation.

"As someone says in the movie, it seemed that Fayyad was taking a page from the Israelis, who in 1947 operated like a state before they were recognised as a state," says Setton, adding that the prime minister was happy to cooperate right from the start.

"Once he opened the door to me, he left it open. I think we both saw a chance to document a very important reality: that finally, after all these years of occupation, the Palestinians have created the foundations for statehood."

The difficulty with making films about a current issue such as Palestine is the fear that matters will have changed dramatically by the time it's ready for viewing. Indeed, we know the UN bid was rejected in 2011, blocked by Barack Obama in the UN Security Council.

We also know that since then, Palestine has had its UN status upgraded to non-member state. Setton says that this upgrading is mentioned in the final shots of the film.

But Setton believes that the US does believe in and aims to reach a two-state solution. "I just think the superpower wants to lead on its terms, it doesn't want to be forced."

Since State 194 was finished, we've also seen recent Israeli elections, in which Netanyahu retained power, albeit with a far lower majority. "To me, the results of this election show that people want a change," he says, adding that a majority of Israelis want a two-state solution.

"But all in all, what people want is a better life. And all in all, those people on the right who support a two-state solution want to separate themselves from Palestine, not out of love for the Palestinians, not out of a realisation that it's about time to end this 46-year occupation, but out of being fed up of having the Palestinian issue on the table. As surprising as it may sound, I'm optimistic that this conflict will be soon coming to an end."