Despite Barak's crushing victory over Netanyahu in the May 1999 Israeli elections, radical steps are needed to fulfil new political expectations. Israelis are encouraged by possibilities of progress in negotiations with the Palestinians and peace with Syria (including withdrawal from Lebanon). The Palestinians are again hopeful, after near despair. Jordan, with Abdullah on the throne after the death of his redoubtable and durable father Hussein, is cautiously developing links with its neighbours, Syria in particular. Syrian-Israeli relations deteriorated while Netanyahu was in power. The challenge now is to get fruitful talks back on track and exploit the new opportunities. Three possible steps forward: the USA and Europe should encourage Israel to take more courageous steps for peace; the Arab states should introduce more open government; and Iraq should be brought back into the Middle East mainstream.