PM says race relations challenge country on Australia Day

By Michael Perry

SYDNEY (Reuters) - Race relations between black and white Australians is one of the nation's great challenges, the country's new prime minister said in an "Australia Day" message, as the word "Sorry" was written in the sky above Bondi Beach.

Prime Minister Kevin Rudd, elected last November, has promised to say sorry to Aborigines for past injustices, reversing an 11-year policy under the previous conservative government that damaged race relations.

"Australia Day is a time to celebrate our nation's past achievements and it's a time to embrace our nation's future," Rudd said on Saturday.

"We should be deeply proud of our country. Proud of aboriginal culture, which represents the oldest continuing culture in human history," he said.

"We stand in awe as we hear the songs and the sounds and the stories and the music which have come down to us from antiquity," he said on Australia's national day.

Aborigines are Australia's most disadvantaged group with many living in third-world conditions in remote outback settlements.

Aborigines and indigenous Torres Strait Islanders number only 460,000, 2 percent of the country's 20 million population, and have a life expectancy 17 years less than white Australians.

They have far higher rates of unemployment, imprisonment, alcohol and drug abuse and domestic violence.