In a measured reaction to the peace initiative, Olmert expressed Israel's readiness to discuss the plan, which also calls for the creation of a Palestinian state and the return of Palestinian refugees to their properties in present-day Israel, which they had abandoned or were forced to leave.

Israel rejected the plan five years ago, not only because it called for far-reaching concessions - including some that would compromise the integrity of Israel as the Jewish homeland - but also because it coincided with the Palestinian intifada during which many Israeli civilians were killed in a spate of suicide bombings.

The positive response by the Israeli prime minister to what is essentially the same peace plan was made amid relative calm this time. Behind a shield of security walls and effective anti-terrorist measures, with suicide bombings by Palestinian militants within Israeli territory virtually eliminated, it appears that Israel is prepared to reconsider the peace plan.

The fact that the Arab League is renewing the offer also indicates that most moderate Arab states have come to terms with the Jewish state's right to exist. Most of them have also become fed up with instability in the Middle East as a result of almost six decades of Israeli-Arab conflict.

Increasingly there is realisation that not just Israel but also Palestine, which has been in the eye of the storm of Israeli-Arab conflict, is part of a problem that must be dealt with once and for all. Although the sense of duty as fellow Muslims to support Palestinian people in their struggle to achieve statehood and justice remains strong among Arab nations, they have also woken up to the fact that the conflict should not be allowed to hold the whole region down. Then there is the war raging in Iraq that has the potential to escalate and widen to pit Iran and perhaps Syria against the United States and its allies, as well as the growing animosity between the Sunnis and Shiites in the Islamic world.

Saudi Arabia, which sees itself as champion of Sunni Muslims, is asserting itself in the face of Iran's hegemony, which has been made more worrisome by its ambition to acquire nuclear arms.

The US, neck-deep in the struggle against insurgency in Iraq, is no longer seen as an honest broker in the Middle East peace process, while the European Union has not been taken too seriously by the key players in the conflict.

It appears that the combination of all these factors has produced a new impetus for peace talks between Israelis and Arabs. Both the Arab League and Olmert have suggested that a region-wide conference be held to enable both sides to discuss ways to move forward the peace process, which too often has been derailed by unrealistic and inflexible positions taken by on or the other side.

To set a positive tone for the land-for-peace deal, Olmert assured Syria that Israel has no intention of attacking the country despite its claim that Damascus supports Palestinian terrorists that target Israeli civilians. Syria, whose Golan Heights remain under Israeli occupation, should reciprocate such a show of goodwill by severing ties with extremist elements in Palestine.

Past failures to achieve peace in the Middle East should offer both sides the lesson that any attempt to dictate the terms of a settlement will be futile and is bound to scuttle the whole reconciliation process.

Both the Arab League and Israel know that not all conditions featured in the peace plan are acceptable to both sides. Arab nations and Israel must make allowance for quid pro quo arrangements in order to make the eventual terms of the peace deal - if it comes to that - palatable to the people in Arab streets and Jewish thoroughfares.

Any successful peace agreement will depend on public opinion in the Arab world and Israel being swayed by promises of lasting peace and the prosperity that will follow.