Our countries have come a long way since David Ben Gurion and Konrad Adenauer first met in 1960. I am thinking here of their meetings in New York and later in the Negev. I am thinking of how trust gradually developed between Israel and Germany. I am thinking of the first state visits by Presidents Chaim Herzog and Richard von Weizsäcker. And I am thinking of Johannes Rau before the Knesset and Ezer Weizman before the German Bundestag.

This path was not easy. We embarked upon it together in full knowledge of the past. We have created foundations on which we can build. I would like Israel and Germany to continue trav­elling along this path into the future together.

Ladies and gentlemen, I stand before you as the newly elected President of the Federal Republic of Germany and I want to reaffirm here today that responsibility for the Shoah is part of Germany's identity. Ensuring that Israel can live within internationally recognized borders, free of fear and terror, is an incontrovertible maxim of German policy. My country has proven this time and again through its actions. Germany will always stand by Israel and its people.

II.

I have been on a long journey during the last six days. It led me from Auschwitz via Berlin to Jerusalem. I would like to tell you about this journey because for me it was also a journey through our common history.

I was accompanied by survivors on my tour of the Auschwitz camp on 27 January. I walked through the gate. I saw the barracks, the railway tracks and the ramp. I walked from the gas chambers to the crematorium. The survivors were by my side. They helped me, a German, at this site. I found that deeply moving.

The events which the survivors described brought alive to me the inhumanity.

What will happen when they are no longer amongst us?

They must remain a part of our present. It is vital that their testimonies are not lost. We must not be allowed to forget the victims' faces. We must ensure that the lessons learnt are passed on from one generation to the next, and we must understand, all of us, that the victims of the Shoah have given us a mandate: never to allow genocide to happen again. Will we live up to this task?

Yesterday I visited Yad Vashem, the place where the memory of the Holocaust is kept alive and those murdered are given a name. I heard the voice which reads out the names of the slain children. It renders the dead their dignity and individuality which the National Socialists wanted to take away from them. Yad Vashem turns anonymous numbers into unique indi­viduals again. Yad Vashem is a place of mourning and remembrance. However, Yad Vashem is also a place of humanity and hope.

I bow my head in shame and humility before the victims and before those who risked their lives to help them. One of them was Raoul Wallenberg, whom you commemorated yesterday.

III.

From Auschwitz I returned to Berlin, to the city from where the genocide was planned and carried out, to the city which today is once again the capital of united Germany.

Germanyhas faced up to the crimes of its past. In particular, Anne Frank's diary, the Eich­mann trial in Jerusalem and the Auschwitz trials in Frankfurt forced us to come to grips with the legacy of the Nazi tyranny. Even the generations born after the war know that the years of the Nazi dictatorship are an indelible part of German history. Although they are not to blame, they know that they bear responsibility for keeping the memory of these events alive and for shaping the future.

After 1945, Germans were given an opportunity, initially in the west, to build an open society. Since the people in the former GDR brought down the Berlin Wall in 1989 using peaceful means, we have become even more aware of the value of democratic freedom.

"Human dignity shall be inviolable". The authors of Germany's constitution, the Basic Law, enshrined this lesson learnt from the National Socialist crimes in its first article. Protecting and respecting human dignity is a task for all Germans; this includes defending human rights at any time and in any place. German policy is ready to be judged by this yardstick.

Every open society also has enemies. Xenophobia and anti-Semitism have not disappeared from Germany. Comparisons which play down the Shoah are a scandal which we must con­front. We should seek to engage right-wing extremists and anti-Semites in a political battle, and we must fight it with vigour.

In doing so, we must above all ask ourselves whether we really are reaching young people, whether teachers, parents and journalists really have made them understand that National Socialism was an aberration. We must never relent in our fight against anti-Semitism. It con­cerns us all.

I can tell you that schoolchildren are particularly active in this field. They conduct interviews with the last eye-witnesses and research the history of their neighbourhood to uncover the traces of the Shoah. In the Kreuzberg district of Berlin, a group of schoolchildren are showing their fellow pupils and friends houses in which Jews who were murdered by the Nazis used to live. In another place, you can currently visit an exhibition in which young people portray their impressions and feelings which a visit to Auschwitz generated. The Jewish Museum in Berlin has had 2.5 million visitors since it opened in 1999. Last year alone, some 7000 groups of young people came, and the bookings for this year already exceed that number.

Despite all the critical attention, we have reason to trust in the strength of democracy in Ger­many.

In this Germany, Jewish communities have been re-established. You, President Katsav, attended the ceremony to mark the opening of the synagogue in Wuppertal in December 2002, together with Johannes Rau and the citizens of that city. For us, the Jewish communities in Germany are a sign of trust in our country which makes us glad. Today, the golden dome of the synagogue in Berlin's Oranienburger Strasse is just as much a part of the cityscape as the dome on the Reichstag building, the seat of the German Bundestag.

The Reichstag dome stands today for the transparency of a vibrant democracy. Anyone look­ing down on Berlin from up there sees the Brandenburg Gate, the symbol of Germany's unity. And they will also see the Memorial to the Murdered Jews of Europe in the heart of the Ger­man capital.

IV.

Today I am your guest here in Jerusalem, a guest in the country which has become the home­land of the Jews. I am here to mark the 40thanniversary of the establishment of diplomatic relations between the State of Israel and the Federal Republic of Germany. Between Germany and Israel there can never be what is called "normality". However, who would have thought 40 years ago that relations between our countries would develop so well, indeed in a spirit of friendship? Today, not only our Governments work well together. Our relations are also char­acterized by the friendship between many people in our two countries.

I am thinking of the youth exchanges, the roughly 100 town twinnings, the work of volunteers from Action Reconciliation and Pax Christi, the cooperation between trade unions, political foundations and parliamentarians. They all stand for the dense network of relations between Germany and Israel. However, I am concerned that exchanges between our citizens have diminished during the last few years - mainly due to the security situation in the Middle East. Nevertheless, ladies and gentlemen, today Germany's relations with Israel are closer than those with any other country outside Europe and North America.

There are thus good reasons to be pleased with the developments of the past 40 years and to celebrate what has been achieved. And that is precisely what we want to do. In just three months you, President Katsav, will visit us in Germany. During your stay, we will host a large party in the grounds of Schloss Charlottenburg for all those who are active in German-Israeli relations. I am very happy to report that so far some 600 young people, both Israelis and Germans, have accepted invitations to this event.

In my delegation here there are also a few school pupils who have acted as hosts to Israeli students. I know that genuine friendships have grown from such contacts. Youth exchanges are an investment in the future. The young people in our countries must get to know each other better, must talk about the past and about the future of this world. I agree with President Katsav that our Governments must devote yet more attention to youth exchange, for it is the young people of today who will determine the future course of German-Israeli relations.

What form could this future take?

The Federal Republic of Germany has created a stable democracy and a viable social market economy. We Germans are proud of this achievement. But we have no reason to be complacent. Our country must face up to the challenges of the 21stcentury. Germany has launched important reforms, and must continue along this path by implementing further measures. I am sure that increased innovation and economic growth will also generate new jobs. That will enhance social cohesion and lessen the dissatisfaction of those who might otherwise cast protest votes. A dynamic Germany is also an attractive partner for Israel.

Notwithstanding great external difficulties, Israel has created a democratic and open society to which we feel close. Israel has made deserts fertile, and its people have transformed it from a developing country into a bastion of high technology. This drive to succeed and innovate can serve as an example to other countries, including Germany. Many foreign companies have long recognized Israel as a source of technological innovation: the "NetWeaver" software platform that is used around the world was jointly developed by Israeli and German software engineers. Israeli and German scientists are working together closely at the Weizmann Institute in Rehovot, at the Hebrew University of Jerusalem, at Tel Aviv University and at the Technion in Haifa. I am looking forward to visiting these centres of research.

Germanyis Israel's principal trading partner in Europe. But the economic potential of German-Israeli relations has not been fully exploited in past years. This we should change. I am convinced that Israel has much to offer the German business community for a partnership based on innovation, not least for start-ups and small- and medium-sized enterprises. What we need are courageous businessmen with an eye for long-term opportunities. I hope that my visit can make a difference.

I am also glad that many Israeli artists and intellectuals are so positively disposed to Berlin's vibrant cultural scene and are keen visitors to the German capital. Germany can well use their creativity. I hope that cultural exchange between our two countries can be further intensified.

I firmly believe that we can increase Germans' interest in Israel, its culture and history, as well as in its natural beauty and the diversity of the country and people.

I see in Israel a partner with whom we share values and interests. There is great potential for cooperation between us now and in the future. I am sure that Israel and Germany can achieve much together. Cooperation is in our mutual interest.

V.

However, we also know that such a partnership between Germany and Israel can only reach its full potential against a backdrop of peace.

In the past four years terror and violence have banished people's hopes of peace to a distant future. Many Israelis ask themselves whether they will ever live in security. That is an alarming development. And in my opinion even more unbearable when we remember that some of these people are survivors of the Shoah. I do not think that we in Germany really understand what it means to live with the fear that those we love could at any time fall victim to a terrorist attack. What it means to take the bus to work every day, knowing it might be blown up. What it means never to feel entirely safe in any restaurant. Every violent death ends an irreplaceable life. Every victim leaves a family with a place that is forever empty at its table.

The terror must end. Suicide bombings are crimes for which there can be no excuse or justification.

Mr President, ladies and gentlemen,I come to you from Sderot. Sderot once stood for terror and fear. Today it can become a symbol of hope.There are encouraging developments on both sides. On both sides the desire for peace is great. Most Palestinians know that the second Intifada has brought great suffering to them as well. Mahmoud Abbas has spoken out against violence, and has followed his words with action in Gaza. There is a new chance for peace. The participants must now do all they can to support this process.

Only Israelis and Palestinians themselves can make peace, and only by working together. The whole world shares your hope that the talks now agreed upon will bring progress. We all know that questions of existential importance for both sides are at stake. I have been watching the seminal struggle for a solution, I can see the fury and despair on both sides. And I know that any solution to this tragic conflict will demand all that the courageous peacemakers have to give.

The US, Europe and the Arab states must support these courageous individuals on the road to peace. Germany will do its part.

VI.

Following the accession of Cyprus, the European Union is now only 20 minutes by air from Israel. We are neighbours with cultural and political affinities.

Germanyis an advocate of Israel's concerns within the European Union. In 1994, under the presidency of Helmut Kohl, the European Council granted Israel "privileged status". My country has also pushed very hard for Israeli interests in the recent past. Israel will now be given improved access to the European common market and to important EU promotion schemes. Germany will continue to help Israel deepen its relations with the European Union.

The security and prosperity of Europe can no longer be considered as separate from developments in your region. Peace is therefore in our own interest.

I firmly believe in a Middle East in which Israel and a Palestinian state exist side by side in peace, a region in which nobody questions the existence of the State of Israel. There must be secure borders in this Middle East. Borders that reconciliation will make permeable. Why should the Middle East not have its successes to parallel Europe's? Here two arch-enemies, Germany and France, have forged a deep friendship; the Iron Curtain has been torn down, and the division of Europe overcome.

"Anyone who does not believe in miracles is not a realist" is a dictum ascribed to Ben Gurion. At a time like this our need for such realists is great, be they Israeli, Palestinian or Arab, German, European or American. We need them to make real what today still seems utopian - peace in the Middle East.