Dear President Ji,

Distinguished faculty members and students,

It is my first visit to China, and I'm thrilled to be here, in this important and impressive state. It is also a great pleasure for me to be in the People's University, one of the most prestigious higher education institutions of China. I am grateful to President Ji for this opportunity.

The Jewish and Chinese peoples are both ancient civilizations with rich culture which contribute significantly to humanity. Both peoples became acquainted with each other more than 1000 years ago, when the first Jews came to China from Europe through the Silk Road.

Unlike the Chinese people who were always remained in their homeland, a large part of the Jewish people were exiled from the land of Israel, and were spread across the globe, including to China, for more than 2000 years. Throughout this time, we have known hatred, anti-Semitism, persecutions and the most horrific event of the century, the Holocaust, where one third of the Jewish people were perished. Throughout this time we have never stopped praying and dreaming to return to the land of Israel, a dream that was realized 60 years ago when the State of Israel was established, as a homeland for the Jewish people and an answer to our national aspirations.

China has proven to be a true friend of the Jewish people when it absorbed thousands of Jewish refugees who fled the Nazis during Second World War, when the gates of the rest of the world were closed to them. We will not forget the kindness offered by China in times of troubles.

Israel and China share many values, among them the appreciation of excellence and learning. Both countries are trying hard to preserve their unique tradition while developing modern and science-based societies and promote a global-oriented economy.

During 15 years of diplomatic relations between Israel and China, we were able to build together a sound base of cooperation and understanding. My visit will explore ways to further promote our already good relations, especially the cooperation in high-tech, agriculture, science and education.

Naturally, the situation in the Middle East will also be addressed. I would like to focus the main part of my talk today on that important issue.

The conflict in the Middle East began long before the rebirth of the State of Israel and continues up until today. Unlike its image, the conflict is not the cause for the instability in our region, but is a result of a greater battle that is being fought in the Middle East and throughout the entire globe: the battle between moderates and extremists.

Extremism is not a local problem - it transcends borders and nations. It is a global threat, which must be dealt with in a global manner - with unity and determination. This battle is global not only because it is being waged throughout the world, but because it is being fought over the values that lie at the heart of every modern society. The extremists are seeking to hijack and pervert the fundamental pillars of coexistence, among them peace, stability and tolerance.

These core values have become the new battlefields. They are the arenas in which the war against extremism will be decided. Extremists do not fight for their own rights, but fight in order to deprive the rights of others.

Extremism manifests itself in many ways. The threat can evolve from state actors or other forms. As a state actor - we witness how a state, a member of the United Nations, like Iran, seeks weapons of mass destruction, violates Security Council's resolutions, supports terrorism world wide, and at the same time calls for the destruction of Israel, a fellow member of the United Nations.

Behind almost every conflict that we have in the Middle East, one can see the long arms and shadow of Iran - the cause for the domestic instability in Lebanon is Hizbullah, the terror organization which is Iran's proxy; in the Palestinian territories Hamas and other terrorist organizations are being supported by Iran, and in Iraq - all of these areas carry Iran's finger prints all over them - in financing, training and arming terrorist organizations.

If this dangerous regime, that wants to dictate its extreme religious ideology to others, masters the technology of developing nuclear weapons - the fragile stability that we are trying to build in the Middle East will vanish. A "domino effect" of nuclear arms race by states and radical elements will begin, and the pragmatic regimes in the region will be undermined.

This understanding is shared by Israel and the pragmatic states in the region. We are together in the need to stop that threat.

The world can not afford such scenario. Leaders, nations, business sectors and the academic circles, it is the responsibility of each and every one of us to prevent it. We must rise above national interests or economical considerations and think about the grave implications that a nuclear Iran will have on the stability of this planet.

We also face the threat of global terrorism - deriving from states or organizations. They use various means and methods to promote their agenda: Send suicide bombers to the streets of London, Bagdad, Jerusalem and Bali, massacre innocent people in Amman, Madrid, Kabul and Tel Aviv; proliferate weapons of mass destruction; spread of incitement and hatred literature and use local political systems in order to penetrate them and destroy them from the inside.

In this context, it is now evidently true that the regional conflicts in the Middle East are the result of the destructive acts of those who don't want to see peace and security in the region, and not as use to be perceived, between Jews and Arabs.

Therefore, Israel and the pragmatic Arab world, including the moderate Palestinians, face the same threat, share the same interest and fight the same battle.

Our policy must be a dual policy; one which combats the extremists and isolates them on the one hand, while at the same time strengthens the moderates and builds with them bridges of understanding and cooperation.

At this moment there is a dialogue between Israel and the Palestinians and I have the privilege to lead the Israeli negotiation team. Coordination of expectations is most important for its success, and I believe it can succeed.

The dialogue should be based on the willingness of both sides to compromise. This includes also an understanding that both sides must also give up on some of their historical dreams on the entire land.

There is a common goal for this dialogue which is based on the vision of two states - Jewish and Palestinian - each giving the only and complete answer to the national aspirations of its own people. Two states living side by side in peace and security. This vision is no longer a zero sum game.

Translating that common vision to a concrete agreement is a complicated task, because we are trying to create a new Palestinian state, something that has never existed before, and we try to do it under daily terror attacks on Israel.

It would be naïve to assume that there are no differences of interests between the two sides - questions of borders, security arrangements and the nature of the relations of the future Palestinian state with Israel - all need to be addressed.

Even if we do, hopefully, resolve the principle issues relating to the Palestinian state, it is clear that we cannot just separate and hand away the key to the other side and hope for the best.

There is no dispute over the fact that there is a gap between the will of the pragmatic Palestinian leaders and their capability to implement future agreements. There is a will, but there is the reality on the ground in which parts of the Palestinian territories are controlled by terrorists.

We must ensure that there is an efficient and effective Palestinian government which takes control over the area and prevents attacks against Israel.

The Gaza experience is a living example for that need. Israel fully withdrew from the Gaza Strip, thus completely terminating its presence in the Strip, and allowing the Palestinians to establish independent governance. In return, we received increased terror, daily Kassam rocket attacks against cities in Israel and the establishment of a Hamas stronghold on our southern border.

With the violent takeover of the Gaza Strip by the Hamas, we see a clear territorial distinction - the terror organization Hamas in Gaza and the pragmatic Fatah in the West Bank. Therefore, our policy, as well, must make this distinction.

The way to resolve our disputes and to proceed with the dialogue is the Roap Map formula, according to which the first stage in the implementation of any agreement is the fight against terror and the dismantling of terror organizations. Insisting on the implementation of the Road Map is not an obstacle, but the opposite; it enables us to advance towards the realization of two states living in peace and security. The world cannot afford another terror state, especially in the Middle East.

I believe that just as a Palestinian state is an Israeli interest, so Israeli security must be a Palestinian interest.

The direct bilateral track between Israel and the Palestinians is the only way to resolve the conflict. But, in order for this process to succeed, it will also require the support of two external circles - the moderate Arab and Moslem states, along with the international community. The moderate Arab and Moslem states must give their support to the process, in a way that will strengthen the moderates in the Palestinian Authority. One of the lessons of the past is the significance of support rendered by the Arab world to the process, that was missing in the past, at critical junctions.

We are now at such a junction, and the pragmatic leaders need this support. The Arab and Moslem world must adopt any decision that the Palestinians accept, and not dictate the results. They must participate in any meeting that is convened, and not present conditions for their participation. Instead of waiting till the end of the conflict in order to normalize relations with Israel, they can take steps now, as Israel takes steps towards the Palestinians.

The second external circle which is equally important is the support of the international community. The role of the international community and China as an important part of it is to give its support to the bilateral track, and encourage the moderate Palestinians to make the necessary compromises . It can also encourage the Arab world to normalize their relations with Israel, which will directly and indirectly support the process.

The international community must also support the process in one of the most crucial elements - the Palestinian institution building. Part and parcel of a viable Palestinian state is the building of efficient and responsible government institutions, ensuring law and order, securing and maintaining monopoly over the use of force, and general capacity building.

Ladies and gentlemen,

As a respected permanent member of the Security Council, and given the influence it has on the Arab world and Iran - China has a crucial role to play - on one hand, to encourage the moderates to proceed with the peace process with Israel - and at the same time to prevent the extremist elements in the Middle East from endangering our efforts to reach an agreement and from undermining the stability in the region.

I think that with the right approach, with determination and unity, we can achieve our common goal - to see a peaceful Middle East and to bring a better and brighter future to the next generations.

Thank you