Secretary-General Ban Ki-moon urged Israel and Lebanon on Tuesday to "seize the moment" of relative calm and move closer to a permanent cease-fire and long-term solution to the issues that sparked a war in 2006.

In a report to the Security Council on implementation of resolution 1701 that ended the 34-day war between Israel and Hezbollah fighters, Ban said "greater overall progress should have been achieved" since its adoption.

The resolution reiterates a call for the disarming of all militias in Lebanon, bans arms transfers to any group except the Lebanese armed forces, and urges the Lebanese government to secure its borders to prevent arms smuggling.

It also calls for Israel and Lebanon to support a permanent cease-fire and long-term solution based on full respect for the U.N.-drawn Blue Line along their border and security arrangements to prevent the resumption of hostilities.

The Security Council was expected to discuss the report Wednesday.

Ban said the election of Michel Suleiman as president of Lebanon, the formation of a government of national unity and the launching of a national dialogue "have led to a greater degree of stability in the country."

"The general improvement of the situation in Lebanon, together with the continued stability in the area of operations and encouraging prospects in the region create a potential momentum that both Lebanon and Israel must seize to make bold strides toward a permanent cease-fire and long-term solution," he said.

The secretary-general said he was "disturbed by the repeated exchange of threats between Israel and Hezbollah, in particular when apparently directed against civilians." He reiterated his call on both sides "to refrain from statements and actions that could serve to increase tension."

Israel has repeatedly accused Hezbollah of rearming, and Ban said the Israeli government continues to report "that it has detailed information regarding significant breaches of the arms embargo across the Lebanese-Syrian border."

"Although the United Nations takes these claims seriously," he said, "it is not in a position to verify this information independently."

But Ban said he remains concerned about "the porous nature" of Lebanon's border with Syria, noting that a team of independent border security experts sent to assess the situation in late August found the border as penetrable as it was the previous year.

"I reiterate the need for the immediate and unconditional respect of the arms embargo on Lebanon," the secretary-general said. "It must be observed fully and without exception. Regional parties, particularly those that maintain ties with Hezbollah and other groups in Lebanon, are obliged to abide fully by the arms embargo."

Ban again called on Israel to immediately halt all overflights of Lebanon and reiterated "with the utmost urgency" his call to Israel to provide data on cluster munitions fired during the 2006 war.

On a positive note, he welcomed the decision of Syria and Lebanon to establish diplomatic relations which "heralds potential future progress on a number of issues of common interest." He said he was also pleased that the issue of abducted Israeli soldiers and Lebanese prisoners in Israel had been fully resolved.

"In the coming months, Israel and Lebanon have an opportunity to move away from confrontation by making further progress in the implementation of resolution 1701," Ban said. "I call upon their leaders to seize the moment that is afforded to them, for the good of their peoples and for the stability of the region."