The coming year is special for us. It marks the 50th anniversary of the state of Israel. A hundred years ago the founder of modern Zionism, Theodor Herzl, dreamt an impossible dream. He predicted the establishment of a thriving Jewish state in the Land of Israel.

His sense of history was extraordinary and his vision uncanny. But I think even he would have been pleasantly surprised by the achievements of this state.

Today almost half the Jews in the world live in Israel. We are a regional power with a strong economy and a proven ability to defend ourselves.

Our standard of living and level of productivity are comparable to those of leading European states. In the sciences and the arts we are among the leading nations of the world.

We have made significant strides towards deregulating, demonopolizing, liberalizing and privatizing the Israeli economy.

We are the world's capital in Jewish studies, and we are putting special stress on education programs that aim to preserve our values and the feeling of Jewish oneness both in Israel and the diaspora.

We have signed peace treaties with two of our neighboring states, and we are in the midst of a peace process with the Palestinians.

I have no doubt that in the near future we will achieve peace with security for our country. And I hope that with the help of the democracies we will also be able to remove the dangers to world peace posed by the predatory regimes in the region.

But there is more to our security than the physical safety we must have. Security also means the preservation of Jewish unity, the nurturing of the bond that ties Jews everywhere. Israel's power is not limited to what we have here. It is the power of a people who may live in all the corners of the globe, but whose heart is with us in Israel.

We have good reason to be proud of our achievements. But we must not forget that the realization of the Zionist dream — the ingathering of the Jewish people in the land of Israel — is not yet complete. Our goal for the next decade must be to have a majority of the Jewish people living in Israel.

The challenges we face are still formidable. To meet them, we must be united in purpose, strong in resolve and unbending in faith.

I wish you all a good new year, a year of peace, security, health and happiness.