Israel is consequently improving its relations with Greece, Ta Nea reported on Wednesday.

Israeli Prime Minister Binyamin Netanyahu on Sunday began a two-day visit to Greece, which was preceded by Greek Prime Minister Yeoryios Papandreou's groundbreaking visit to Israel three weeks ago.

Seeking to broaden its diplomatic contacts in the wake of the rising global condemnation of the Gaza flotilla attack, before its Greek initiative Israel had already begun improving its ties with other traditional rivals, including Bulgaria and Cyprus.

Among the items on the agenda that Netanyahu discussed with Papandreou were boosting bilateral military ties to include sharing expertise and holding joint exercises. Netanyahu told reporters after the meeting that his visit, the first by an Israeli prime minister to Greece, was the "opening of a new chapter," while Papandreou described his discussions with Netanyahu as "very productive." During Netanyahu's sojourn, the two leaders and their wives took a symbolic ride to an island off Athens' coast aboard a Coast Guard vessel that Israel sold to Greece in 2002.

Speaking on condition of anonymity, Greek diplomatic sources commented that the impasse in Israeli-Turkish relations was the direct cause of improved Israeli relations with Greece, prompting Netanyahu's visit as the first Israeli prime minister to officially visit Greece, which Israel has previously found of concern due to its strong labor and leftist political movements, which have traditionally been strong pro-Palestinian. Sources add that Papandreou appears interested in promoting his policies both in Israel and the Arab world when moderate Arab powers are concerned about both Iran and what some analysts term Turkish Prime Minister Recep Tayyip Erdogan's "neo-Ottoman" initiatives, with Papandreou consequently seeking a mediating role in the Middle East peacekeeping process.

Aside from Greek diplomatic aspirations to play an expanded regional role, Greece's current dire economic situation is also a topic of discussion between the two prime ministers. Papandreou's government is concerned to engineer a quick re-entry to world global financial markets to refinance its crushing debt burden and believes that the U.S.-Jewish lobby could play an important role in this effort.

Carefully weighing the potential diplomatic fallout, prior to Netanyahu's arrival Papandreou called every Arab leader in the region, beginning with Egyptian President Hosni Mubarak, to inform them of the visit and stress that he intended to press Israel to move forward with the deadlocked Israeli-Palestinian peace negotiations.

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