Exit polls show Netanyahu's Likud and the centrist Blue and White in a tie. Neither party has enough seats with their allies to form a majority, raising the prospect of tough negotiations for a unity government.
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Netanyahu-Gantz race too close to call
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Israeli Prime Minister Benjamin Netanyahu appeared to suffer a setback in national elections Tuesday, with his religious and nationalist allies failing to secure a parliamentary majority, early exit polls showed.
Exit polls from Israel's three major television stations showed the centrist Blue and White party of ex-military chief Benny Gantz is projected to win 32 to 34 seats, while Netanyahu's right-wing Likud party is on pace for between 30 and 33 seats. Another projection estimated both parties would receive 32 seats each.
Israeli exit polls are often imprecise and initial results expected on Wednesday could shift the seat count.
Either way, the results indicate that Netanyahu or Gantz will face tough and protracted negotiations to cobble together a government.
The initial results showed that neither Blue and White nor Likud would be able to form a 61-seat majority in the 120 member Knesset with the support of their allies.
Likud and its religious and nationalist allies with which it hoped to form a majority only have 55 seats, less than in April's election, according to the average of the three exit polls. Blue and White could enlist the support of 59 for a center-left government.
Lieberman as kingmaker
The results put ex-Defense Minister Avigdor Lieberman in a kingmaker role. His secular, hardline Yisrael Beitenu that receives most of its support from Russian-speakers was on pace to win 9 seats, nearly double its performance in April's election.
Lieberman, a former Netanyahu protege, refused to join a Likud-led government following April's election because of what he described as excessive influence from ultra-Orthodox religious parties. His move forced Netanyahu to call new elections to avoid giving other parties a chance to form a government.
Late Tuesday, the Moldovan-born Lieberman reiterated that he sought a broad unity government with Likud and Blue and White.
A potential complication is that Gantz has ruled out forming a government with a Netanyahu-led Likud at a time when the prime minister is expected to be indicted on corruption charges in the coming weeks. Lawmakers in Gantz's party have said they are open to a unity government with Likud, but not under Netanyahu's leadership.
"We will act to form a broad unity government that will express the will of the people," Gantz said at a post-election rally, though he cautioned supporters to wait for final results.
Lieberman is unlikely to want to sit in a government with left-wing Arab parties or the ultra-Orthodox religious parties. Blue and White is also unlikely to ask Arab parties to join a coalition.
Netanyahu in a late-night address to party supporters said that he wanted to assemble a "strong Zionist government and to prevent a dangerous anti-Zionist government" with any Arab parties.
Continuing a campaign theme against Israel's 20% Arab minority that critics have called racist, he claimed that Arab parties "negate the existence of Israel as a Jewish and democratic state" and "glorify bloodthirsty murderers."
Israeli PM pledges to annex Jordan Valley
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Arab parties come in third place
The Joint List, an alliance of Arab parties, came in third with 14 seats, according to exit polls. They have suggested they could potentially block Netanyahu from becoming prime minister by recommending Gantz.
In other results, the ultra-Orthodox Shas and United Torah Judaism were expected to win nine and eight seats, respectively; the right-wing Yamina party seven; the Labor Party six; and Democratic Union five seats. The ultranationalist Jewish Power faction, widely viewed as a supremacist group, failed to overcome the threshold to enter parliament.
Over the next days, the focus will shift to President Reuven Rivlin, who is responsible for choosing the candidate he believes has the best chance to form a government. That is usually, but not always, the leader of the largest party.
Promised land, enemy land: Israel 70 years after independence
Triumph or catastrophe? The state of Israel was declared 70 years ago this week, according to the Hebrew calendar — a turning point for Jews after the Holocaust. DW looks back at events that have shaped Israeli history.
Image: Imago/W. Rothermel
Long-held hope is victorious
On May 14, 1948, David Ben-Gurion, future first prime minister of Israel, declares the state's independence, outlining the Jewish story: "The people kept faith with (the land) throughout their dispersion and never ceased to pray and hope for their return to it and for the restoration in it of their political freedom." It was the birth of an internationally recognized Jewish homeland.
Image: picture-alliance/dpa
The darkest hour
While the controversial idea of a God-given land for Jews has biblical roots, the Holocaust was a close, powerful backdrop for the significance of Israel's founding. Nazi Germany murdered six million Jews across Europe, and those who survived the concentration camps endured expulsion and forced labor. The above photo shows survivors of the Auschwitz camp following liberation.
Image: picture-alliance/dpa/akg-images
'Nakba': Arabic for 'catastrophe'
Directly after Israel's founding, it was attacked by troops from Egypt, Syria, Jordan and Iraq - among others. Israel pushed back and expanded its control over 77% of Palestinian territory. Some 700,000 Palestinians were driven from their homes. "Nakba" is what Palestinians call this event. The war encapsulated the still unresolved Mideast conflict sparked in 1917 with the Balfour Declaration.
Image: picture-alliance/CPA Media
Life on a kibbutz
These land collectives, known as kibbutzim in the plural, were established across Israel following independence. Many were run by secular or socialist Jews in an effort to realize their vision of society.
Image: G. Pickow/Three Lions/Hulton Archive/Getty Images
A state at war
Tensions with its Arab neighbors erupted in the Six-Day War in June 1967. With a surprise attack, Israel is able to swiftly defeat Egypt, Jordan and Syria, bringing the Arab-populated areas of the Sinai Peninsula, the Gaza Strip, the West Bank, East Jerusalem and the Golan Heights under Israeli control. Victory leads to occupation — and more tension and conflict.
Image: Keystone/ZUMA/IMAGO
Settlements on disputed territory
Israel's settlement policy worsens the conflict with Palestinians. Due to development and expansion of Jewish areas on occupied Palestinian land, the Palestinian Authority accuses Israel of making a future Palestinian state untenable. Israel has largely ignored the international community's criticism of its settlement policy, arguing new construction is either legal or necessary for security.
Image: picture-alliance/newscom/D. Hill
Anger, hate and stones: The first intifada
In winter 1987, Palestinians begin mass protests of Israel's ongoing occupation. Unrest spreads from Gaza to East Jerusalem and the West Bank. The uprising eventually wound down and led to the 1993 Oslo Accords — the first face-to-face agreement between the government of Israel and the Palestine Liberation Organization (PLO), the representative body of the Palestinian people.
Image: picture-alliance/AFP/E. Baitel
Peace at last?
With former US President Bill Clinton as a mediator, Israeli Prime Minister Yitzhak Rabin (left) and PLO Chairman Yasser Arafat hold peace talks. The result, the Oslo I Accord, is each side's recognition of the other. The agreement leads many to hope that an end to the Israel-Palestine conflict is not far off, but peace initiatives suffer a major setback when Rabin is assassinated two years later.
Image: picture-alliance/CPA Media
A void to fill
A right-wing Jewish fanatic shoots and kills Rabin on November 4, 1995, while he is leaving a peace rally in Tel Aviv. Rabin's assassination throws the spotlight on Israel's internal social strife. The divide is growing between centrist and extremist, secular and religious. The photo shows Israel's then-acting prime minister, Shimon Peres, next to the empty chair of his murdered colleague.
Image: Getty Images/AFP/J. Delay
Addressing the unspeakable
Nazi Germany's mass murder of Jews weighs on German-Israeli relations to this day. In February 2000, Germany's then-President Johannes Rau addresses the Knesset, Israel's parliament, in German. It is a tremendous emotional challenge for both sides, especially for Holocaust survivors and their descendants, but also a step towards closer relations after unforgettable crimes.
Image: picture-alliance/dpa
The Israeli wall
In 2002, amid the violence and terror of the Second Intifada, Israel starts building a 107-kilometer-long (67-mile-long) barrier of barbed wire, concrete wall and guard towers between itself and Palestinian areas of the West Bank. It suppresses the violence but does not solve the larger political conflict. The wall grows in length over the years and is projected to reach around 700 kilometers.
Image: picture-alliance/dpa/dpaweb/S. Nackstrand
A gesture to the dead
Germany's current foreign minister, Heiko Maas, steps decisively into an ever closer German-Israeli relationship. His first trip abroad as the country's top diplomat is to Israel in March 2018. At the Yad Vashem Holocaust memorial and museum in Jerusalem, he lays a wreath in memory of Holocaust victims.