He played a significant role in negotiating Israel's peace deal with King Hussein of Jordan, the bringing of Ethiopian Jews to Israel and Israel's response to the September 11, 2001, attacks on the United States.
In the first of a two-part interview he discusses failures in Israel's preparedness for the country's invasion of Lebanon earlier this year and how he believes Hezbollah lost the subsequent war. Next week Aljazeera.net will publish Mr Halevy's views on Palestine, the Middle East road map and Iran's nuclear programme.
Halevy is currently head of the Centre for Strategic and Policy Studies at the Hebrew University of Jerusalem. His book Man in the Shadows: Inside the Middle East Crisis with a Man who led the Mossad was published in March 2006.
Aljazeera.net: Was Israel defeated by Hezbollah during the war?
Efraim Halevy: I do not think that Israel was defeated by Hezbollah during the war. I believe that Israel did not achieve all of its objectives. In my view, the following are the indications that Israel did succeed in seriously damaging Hezbollah in Lebanon and limiting its freedom of action:
i) Hassan Nasrallah has publicly stated that he misjudged Israeli reaction to his incursion across the international border on July 12 when his forces killed eight Israeli soldiers and kidnapped two soldiers from within Israel territory. He has publicly stated that had he had the faintest indication as to how Israel would react, he would not have mounted the operation.
ii) From almost day one of the Lebanese war of summer 2006 Hezbollah and Iran and Syria, its mentors, daily appealed for a ceasefire. A winning force does not appeal for a ceasefire but accedes to requests of others.
iii) Initially, Hezbollah strongly objected to the entry of an international force into Lebanon with the mission of aiding the regular Lebanese army to deploy along the UN recognised Lebanese-Israeli international border. It also objected to Lebanon accepting the other provisions and stipulations of UN Security Council (UNSC) resolution 1701 which lays the blame on Hezbollah for starting the recent conflict. This resolution was unanimously approved by the UNSC and Iran and Syria are obligated to honour it.
iv) Nasrallah has been forced to order his remaining men in the south not to parade openly with their weapons and for the moment is respecting the letter of the ceasefire.
v) UNSC resolution 1701 calls for the total disarming of the Hezbollah. Nasrallah and his forces are defiant in their refusal to abide by this decision and, as a result, are flouting the wishes and demands of the entire international community, including the major states in the Middle East and the Arab world.
vi ) Hezbollah is now engaged in an intense internal struggle inside Lebanon. It has labeled Fuad Siniora, the Lebanese prime minister, a traitor and is calling for the replacement of his government with a national unity government. This demand has been rejected.
The result of the war is, therefore, a unique one. Israel may not have won the war as it hoped, but Hezbollah clearly lost it by its own testimony.
One of the strongest themes of your book Man in the Shadows is responsibility at the top of any organisation. Do you think Prime Minister Olmert should resign?
I strongly believe that responsibility originates at the top. In the Israeli system of government judicial commissions are appointed to determine the facts and to propose ways and means of preventing future failures. Such a commission has been set up in Israel and I think that we should all reserve judgment until the findings are published. I am wondering if Hassan Nasrallah will step down in the light of his self-admitted strategic mistakes.
What were the main failings of Israeli intelligence before the war in Lebanon?
On the basis of published accounts of the conduct of the war, I think that there was insufficient regard given to several aspects of the ground operations. However, it now transpires that at a very early stage of the hostilities much effort was invested in forging a diplomatic exit strategy, the culmination of which was UNSC resolution 1701. At the crucial stages of the war, the diplomatic success was seemingly greater than the military one. Israel was quick to enter into intensive negotiations on the international scene almost after day four of the war and Tzipi Livni, the foreign minister, toiled round the clock to promote a viable exit opportunity.
Last month, the Wall Street Journal reported: "Eyewitness accounts by Israel's citizen-soldiers (reservists) spoke of critical supply shortages, leadership failures and disarray on the battlefield." How did a country renowned for its military prowess find itself in this situation?
The shortcomings of the Israeli Defence Force (IDF) logistics and related functions were an Achilles heel of the war from the Israeli aspect and are now the subject of in-depth interrogation. Sadly, in every war that Israel has fought, we have experienced shortcomings and disorder. However, let it be clear that war is not usually a precision clockwork operation. War is never conducted "by the book" and it will never be so. All wars are laced not only with glorious campaigns and victories but, alas, also by failed operations, sad incidents of death through "friendly fire" and the like. I am confident that the lessons of our failures will be digested before we are put to the test once again.
When you resigned as director of the National Security Service in 2003 you said of the Sharon administration: "A situation has emerged in which decisions are not being made in an orderly way. There is an intolerable sense of offhandedness in Israel today in making fateful conditions." Do you believe this situation continued and contributed to Israel's strategy in Lebanon?
The conduct of the war, as already mentioned, is now being reviewed in Israel by a judicial inquiry commission and I do not wish to second guess its findings. The state controller is conducting a parallel investigation which, so I understand, will also cover the decision-making process.
A couple of days ago he published a report which was severely critical of the manner in which the National Security Council that I headed for one year was sidelined by successive prime ministers.
If the process where we "slid" into war will be exposed as faulty, this will become public knowledge.
I cannot avoid a thought concerning the "decision-making" process that led Hassan Nasrallah to launch the opening gambit of the Lebanese war of 2006 with such disastrous results for Hezbollah and the Lebanese nation.
How did he reach the decision? Who, in his ruling Shura council participated in the discussions prior to the attack? Were the Iranian representatives on the council active participants in the decision? I wish a method could be devised to help us all find out how this all came about.