Obama also has said he believes that Jerusalem will be the capital of Israel, remarks that have caused concern among some Palestinian leaders.

CNN: Obama could inherit Gaza crisis

The totality of these changes has the potential to compel much-needed upheaval in Israel's capital markets, regulatory structures, and perhaps even the nation's very view of itself.

FORBES

When Bill Gates was looking for a location for Microsoft's second software development center outside the U.S. (the first was in Israel), he chose Hyderabad, capital of the south Indian state of Andhra Pradesh.

FORBES: Microsoft's passage to India

Just as important, Israel's capital markets mesh closely with those of the rest of the world, Nasdaq in particular.

FORBES: Why the Middle East doesn't work

Fatah has supported the peaceful two-state principle since the late 1980s, but half the 11-member Central Council opposed the terms of the agreement with Israel negotiated secretly in the Norwegian capital.

ECONOMIST: Palestine

In short, jobs and opportunity are plentiful in Israel precisely because the country seeks the inflow of human capital.

FORBES: Dan Senor and Saul Singer's "Start-Up Nation" Explodes Economic Myths, Promotes Some Too

However, Syria's military said Wednesday and again Thursday in state-run media that Israel had struck at a defense research facility near the capital of Damascus, killing two workers and injuring five others.

CNN: Iran, Syria warn of retribution for Israeli airstrike

Access to venture capital is, per capita, 20-fold greater in Israel than in the rest of Europe.

WSJ: Tel Aviv Takes the Tech-Hub Crown

Meanwhile, both Israel and the Palestinian factions have signalled that they hope to make political capital out of the murder trial of Marwan Barghouti, a senior Palestinian leader.

ECONOMIST: Another blind alley | The

The leaders of Arab nations are aware of this fact, and Obama can use his political capital to build support for diminishing traditional hostility toward Israel.

CNN: Commentary: Obama can succeed in Mideast