You cannot like the word, but what is happening is an occupation - to hold 3.5 million Palestinians under occupation. I believe that is a terrible thing for Israel and for the Palestinians.

We don't have any intention whatsoever to use military force to solve the Palestinian problem. But when it comes to terror - when it comes to terror, I believe that military - the right military steps is a very, very complicated kind of warfare, where I make every effort not to escalate the situation.

To our Palestinian neighbours, I assure you that we have a genuine intention to respect your right to live independently and in dignity. I have already said that Israel has no desire to continue to govern over you and control your fate.

In Lebanon, there was an agreement not to liquidate Yasser Arafat. In principle, I'm sorry that we didn't liquidate him.

Both during the elections and as Prime Minister, I have repeatedly and publicly said that I support the establishment of a Palestinian state alongside the State of Israel.

If there will be a serious Palestinian prime minister who makes a 100 percent effort to end terrorism, then we can have peace. Each side has to take steps. If terror continues, there will not be an independent Palestinian state. Israel will not accept it, if terror continues.

I believe that the Jewish state will exist forever.