The most momentous declaration of the Arab world since Israel's inception in 1948 was the Arab Peace Initiative, launched in March 2002 in Beirut, Lebanon, and re-adopted by the Arab League in March 2007. The Initiative calls on Israel to withdraw from the territories captured in 1967, arrive at a just solution to the Palestinian refugee problem, and establish a Palestinian state with East Jerusalem as the capital. The author argues that the Initiative can be fully reconciled with Israel's core requirements for peace: 1) ensuring Israel's national security and territorial integrity, 2) sustaining Israel's Jewish national identity, 3) maintaining the unity of Jerusalem as Israel's capital, and 4) establishing normal relations with the entire Arab world.