Israel's strategic relationship with Turkey strengthens despite the strains on ties with other nations in the regio.

U.S., Turkish, and Israeli naval forces take part in "Operation Reliant Mermaid," a joint search-and-rescue operation off the Mediterranean coast in early January.

Israeli and Turkish military industries tighten cooperation on a wide range of issues, and Israel wins a contract to upgrade forty-eight Turkish F-5 fighter planes at a cost of seventy-five million dollars.

To improve ties with the Arab world and counter domestic criticism of rising casualties in Israel's self-declared security zone in southern Lebanon, Defense Minister Yitzhak Mordechai launches an initiative in January for an Israeli pullback.

It is based on UN Resolution 425, which calls for Israeli withdrawal and Lebanese military control of the evacuated areas.

Mordechai declares that Israel will withdraw if the Lebanese army guarantees security in the south.

A fragmented right wing hinders Netanyahu's reelection campaign, as does voters' growing dislike of his inconsistent peace policies and his often abrasive style.

In addition, a series of scandals have plagued his administration, including his appointment in 1997 of Likud party functionary Roni Bar-On as attorney general.

Allegations that Bar-On would arrange a plea bargain for a Netanyahu ally who had been charged with fraud and bribery lead to a series of confidence votes in the Knesset.

Former defense minister Yitzhak Mordechai, former finance minister Dan Meridor, and Tel Aviv Mayor Roni Milo break away from Likud to form a new, more moderate Center Party; Benny Begin, son of former Likud prime minister Menachem Begin, leaves the party to head a new, more hawkish group called the National Unity.

Israeli-Arab candidate Azmi Bishara, of the Balad-National Democratic Assembly, withdraws from the five-sided prime ministerial race, followed in quick succession by Begin and Mordechai, on May 15, 1999, two days before the election.

Mordechai endorses Barak; Begin refuses to do the same for Netanyahu.

The result is a landslide victory for Barak by 56.08% to 43.92% (1,791,020 votes to 1,402,474).

Netanyahu immediately resigns as Likud Party leader and is succeeded by the outgoing foreign minister, Ariel Sharon.

The election produces an even more fractured Knesset than the one three years earlier; smaller parties increase their seats, with no fewer than fifteen parties winning seats.

Whereas in 1992, under the old, purely parliamentary system, the two largest parties had between them won seventy-six of the one hundred and twenty seats, by 1999 they can command only forty-five.

The One Israel coalition wins the most seats in the Knesset, while Likud, beset by infighting and a stalled economy, is second.

The real surprise of the election is the sudden growth of Shas, which now commands the third-largest number of seats.

The election results are seen as a turning away from the hard-line policies, particularly in relations with the Palestinians, pursued by Netanyahu.