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Today Italy assumes the role of European Union president for the 11th time in its history. As one of the original six founding members of the European Economic Community in Rome in 1957, Italy has witnessed many changes and evolutions in the various phases of the EEC and the EU. This year's presidency takes place at one of the most sensitive points in time, on the eve of the EU's enlargement from 15 to 25 member states.

The Italian presidency over the next six months will be dealing with five main areas: the adoption of the new European Convention; economic reforms (in the field of pensions and the labor market as well as in reinforcing competitiveness); integration of the new members in the work of the Council of Ministers and promotion of the "wider Europe" concept that envisions stronger ties with other states, including Russia and Israel; the articulation of a common policy on illegal immigration and crime; and the consolidation of a common European foreign policy with a clear emphasis on the Middle East peace process.

All these topics on the agenda will be joined by other matters such as international trade, environmental issues and the fight against international terrorism and non-conventional weapons proliferation.

From the Israeli viewpoint, the coming months appear to be a historic watershed as they hold in store both an important opportunity to advance the peace process as well as numerous risks, including that of increased terrorism and an intensification of the Iranian nuclear threat. The appointment of Mahmoud Abbas as Palestinian prime minister, along with an increased American involvement in the peace process following the war in Iraq, have created a window of opportunity that the Quartet (the U.S., Russia, the UN and the EU) will try to use to bring the negotiation process back on track.

In this context, Italian Prime Minister Silvio Berlusconi did well to visit Israel three weeks ago, on the eve of the Italian presidency. His visit was a reflection of the warm relationship now existing between our two countries as well as Italy's deep understanding of the security constraints Israel is forced to deal with.

The Italian prime minister's decision not to meet Yasser Arafat, in addition to being an act of courage rare among European leaders, also emphasized the conflicts within Europe and the creation of new and different patterns of thought regarding how best to promote and encourage the peace process.

Some of the new members of the EU will surely follow in Italy's footsteps on a road that stems not from a unilateral pro-Israeli position but rather from the understanding that as opposed to Arafat, his successor is determined to abandon the path of violence in favor of a peaceful resolution of our conflict. Italy, along with the U.S. and Israel, understands the need to reinforce and encourage him.

All the signs seem to show that Italy intends to use its presidency to promote its own position within the EU as well as the position of the EU within the Quartet alongside Washington, while putting its excellent relations with the Arab world and with Israel to the best use possible.

The Italian government understands, maybe better than any other European government, how much a balanced position can strengthen its influence in the region and, conversely, how much the traditional, almost blind European pro-Palestinian stance and automatic condemnation of any Israeli action were detrimental when trying to play a constructive role in resolving the Middle East crisis, whose resolution is also in Europe's interest.

In this context, we are hopeful that Italy will also lead an initiative to include the Hamas and Hezbollah movements in the European list of terrorist organizations as warranted by the two groups' characteristics and the fact that their very existence serves the sole purpose of committing acts of terrorism and violence against Israel. Europe's outlawing of these groups will also help the moderate wing of the Palestinian leadership.

Italy's desire to strengthen the EU's position in the Middle East also contains a concrete means to back up such a policy in the shape of what PM Sharon calls the "Berlusconi Plan" for economic rehabilitation of the Palestinian Authority. This is undoubtedly a key tool that will permit the EU presidency to emphasize the economic dividends inherent in a political solution to the crisis, in parallel with a cessation of acts of terror and violence. A clear position combining a strong stand against terrorism on the one hand and economic benefits to the moderate Palestinian leadership on the other hand will enjoy the full cooperation of the Israeli government.

The Italian presidency starts at a sensitive moment also in the framework of U.S.-European relations following the Iraq war. All the diplomatic capabilities of Prime Minister Berlusconi and Foreign Minister Frattini will be put to the test both in bridging the conflicts between Israel and its neighbors and in thawing the tense relations between the old continent and America.

I doubt whether there is today any other European country capable of repairing those rifts on the Middle Eastern and the transatlantic levels. From the Israeli point of view, a strengthened, balanced European line led by Italy can only contribute to the implementation of a political solution to the Middle East conflict.

The writer is Israel's ambassador to Italy. This article also appears today in the Italian daily Corriere della Sera.