Israeli Prime Minister Benjamin Netanyahu looks on during a press conference at the Knesset in Jerusalem, on May 6, 2015, as he announced reaching a coalition deal for forming a new government. (Gali Tibbon/AFP/Getty Images)

Israel’s new coalition government, formed with the slimmest possible majority in its parliament, likely means that Prime Minister Benjamin Netanyahu will act even more cautiously than he has in the past. This is a tragedy, because Israel faces an extraordinary strategic opportunity.

At first glance, it might seem absurd to speak hopefully about opportunities for Israel. The Middle East is in turmoil, Islamic radicalism is invading once-stable lands, Hezbollah and Hamas are active, and the Iranian nuclear danger persists. Add to this the repulsive anti-Semitism that is on the rise around the world — tolerated and encouraged in too many Muslim communities — and it looks like a very dangerous time for the Jewish state. That is what Netanyahu implied when explaining to NBC’s Andrea Mitchell why he had backtracked on his support for a Palestinian state. “What has changed,” he said, “is the reality.”

Reality has changed, but look beyond the headlines. On closer examination, one can see that it has changed dramatically in Israel’s favor.

First, there is the disappearance of the Arab threat. From its first day in existence, Israel has faced the danger of extinction by Arab armies. This is the threat against which the Jewish state has planned, armed and trained for most of its national life. Today, it’s gone.

The armies from Israel’s main strategic adversaries — Iraq, Syria, Egypt — are in disarray, while the Israeli armed forces have become the region’s superpower, in a league ahead of the rest. More important, Egypt, Saudi Arabia and the smaller Gulf states find themselves in a tacit alliance with Israel against Iran. In Gen. Abdel Fatah al-Sissi, Israel is dealing with perhaps the most anti-Hamas (and tacitly pro-Israeli) president in Egypt’s history.

To understand the depth of this strategic shift, consider this: It has been reported that Arabs are thinking about creating a combined armed force. The last two times that happened, in 1948 and 1967, the purpose was to wipe Israel off the map. Today, the aim is to fight Israel’s main foe, Iran, which is why, one Haaretz commentator notes, “Not only is Israel not alarmed, it is actually ecstatic.”

Second, Israel’s major enemies are under greater pressure than ever before. Iran and Hezbollah are committed to defending the Bashar al-Assad regime in Syria — a daunting challenge, given that Assad represents the Alawites, who account for less than 15 percent of the country. Reports vary on how costly this support has been for Tehran — the Economist has cited a $15 billion figure, which would be the equivalent of about one year’s total defense budget for Iran. Hezbollah has become bogged down in Syria, with hundreds of its fighters having died there. The Syrian conflict will likely continue to occupy and drain Iran and Hezbollah for years, a crippling problem with the price of oil having fallen, and with it, Iran’s revenue.

Watching the conflicts in Syria, Iraq, Yemen and Libya, one cannot but think that Israel’s main enemies — Shiite and Sunni extremists — are busy killing each other.

Of course, there is Iran’s nuclear program, though it has significantly slowed for now. Whatever the outcome of nuclear negotiations, it is worth remembering that Israel has a powerful deterrent, by some accounts as many as 200 nuclear warheads, many of them on submarines. Similarly, it has built a wall that reduced terrorist attacks against Israel to virtually zero, and its Iron Dome defense system has blunted the threat from Hamas and Hezbollah rockets.

And there is Israel’s economy, which continues to surge forward, outstripping the others in the region. As its waves of technological innovation and productivity continue, Israel finds itself courted by countries from China to India, which were once reluctant to even publicly acknowledge relations with Jerusalem.

So while it faces real dangers, Israel has policies to fight them with force and effectiveness. The danger for which it has no defense is that it continues to have control over Gaza and the West Bank, lands with 4.5 million people who have neither a country nor a vote. The feeling on the Israeli right, which now rules the country, seems to be that if the Palestinian problem is ignored, it will somehow solve itself. But it won’t, and the tragedy is that this is the moment, with so many stars aligned in Israel’s favor, when enlightened leadership could secure Israel permanently as a Jewish democratic state and make peace with its neighbors. It is a golden opportunity, and it is staring Netanyahu in the face.

Read more from Fareed Zakaria’s archive, follow him on Twitter or subscribe to his updates on Facebook.