JERUSALEM (AP) ― The Mideast conflict has done little to help Israel’s image in the world, but the way local filmmakers deal critically with the Israel-Palestinian issue has won wide international praise ― and this year, recognition from the top of the movie industry.

Two Israeli-produced documentaries about the conflict have been shortlisted for possible nomination in this year’s Academy Awards. Few Israeli films have contended in the Best Documentary category before. The shortlisted films represent rare recognition of foreign entrants in a category dominated by American productions.

The two films examine the conflict from contrasting viewpoints, one through the eyes of the occupier and the other through those of the occupied. Neither does the Israeli government any favors ― though it helped foot the bill.

“The Gatekeepers” features candid interviews with retired Israeli spymasters, while “5 Broken Cameras” tells the personal story of an amateur Palestinian cameraman who documents clashes between his fellow villagers and Israeli soldiers and settlers.

Both films were listed by the New York Times as “Critics’ Picks,” and “The Gatekeepers” won praise from the paper’s chief critic as one of the best documentaries of 2012. The final Oscar nominations will be announced Jan. 10.

Israel’s overall image in the world has taken a beating because of the decades-long conflict with the Palestinians, but even critics say its film industry shows that Israel remains a vibrant democracy. In recent years, international film festivals have awarded Israeli directors accolades for their soul-searching portraits of the country.

Israeli films were finalists for the Academy Award for Best Foreign Language Film four times between 2008 and 2012, giving Israel more nominations during that period than any other country. Three of the films dealt with the Israeli-Arab issue.

Films going beyond the conflict have also scooped up awards. A feature film this year about the country’s cloistered ultra-Orthodox Jewish community won the best actress award at the 2012 Venice International Film Festival, though it did not make the cut for the Oscars.

This “golden age” of Israeli cinema is almost counter-intuitive. While shining a critical light on Israeli policies and society, the films have been significantly bankrolled by the government.

“Our ability at self-criticism is very rare,” said Yehuda Stav, chief film critic at the Israeli daily Yediot Ahronot. “There is complete freedom (in Israel) to make documentary films that talk about our problems, that criticize what we do.”

In Israel’s informal society, filmmakers and journalists have easy access to senior officials. That helped director Dror Moreh secure exclusive interviews with some of Israel’s most shadowy figures: six retired directors of Israel’s domestic spy agency, the Shin Bet.

The position is so secretive that until recently, the director of the Shin Bet was long known to the public only by his first initial, and his identity was disclosed only upon retirement.