The Prime Minister said that the status of the islands would not be a "fruitful line" to pursue during the first Argentinian state visit to the UK since the conflict in 1982.
Mr Blair told an Argentinian daily newspaper: "We have made it clear that the visit is not going to be about negotiating on the Falklands. We have a difference there, but it is not the dimension on which this visit is going to focus."
Mr Menem, who arrives today, aims to discuss the British arms embargo that has been in force against his country since the war. The Foreign Secretary, Robin Cook, yesterday said that there were some "plainly daft" anomalies thrown up by the arms ban. He revealed that the embargo had prevented British and Argentinian forces working together in the UN peacekeeping operation in Cyprus from exchanging vehicles. Mr Cook stressed, however, that any relaxation of the ban would have to ensure that arms exported would not be used against the Falklands, he told the BBC's Breakfast with Frost programme.
The most likely outcome is the replacement of the current embargo with the system of licences that governs weapons exports by Britain to most other countries. But this will not lead to any immediate boost in arms deliveries.
The Government, however, is keen to build bridges after the controversy over Mr Menem's "historic apology" for the Falklands invasion in an article for The Sun threatened to turn the trip into a diplomatic fiasco. Mr Blair's press secretary, Alastair Campbell, had helped draft the article. In the face of bitter criticism in Argentina, the president was forced to deny that he had apologised for the conflict. To the dismay of Downing Street, Mr Menem tried to reinforce his independence by backing calls for the release of former Chilean dictator General Augusto Pinochet. Now, ministers hope that the visit can get back on track and concentrate on boosting trade between the countries.
Mr Menem will lay a wreath at a joint ceremony at St Paul's Cathedral, London, honouring 1,000 British and Argentinians killed in the conflict.