Blair calls for Middle East 'alliance of moderation'

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Tony Blair today called on countries in the Middle East to form an " alliance of moderation" to take on Iran as part of a "monumental struggle" between democracy and extremism.

In a speech in Dubai, the Prime Minister said that extremists motivated by a "warped and wrong-headed" interpretation of Islam pose a threat not only to America and its allies, but to moderate people across the region.

He appealed to moderate countries to mobilise against extremists in " the struggle of the early 21st century". He warned: "It is not too late, but it is urgent."

On the final lap of a five-day visit to the Middle East, Mr Blair said: "We must support and empower moderate and modernising governments and people everywhere in this region. We must recognise the strategic threat the government of Iran poses - not its people, not possibly all of its ruling elements but those presently in charge of its policy. They seek to pin us back in Lebanon, in Iraq, in Palestine. Our response should be to expose what they are doing, build the alliances to prevent it and pin them back across the whole of the region."

Mr Blair acknowledged that the solution to the Middle East's problems must come from within the region, but said its impact will be felt everywhere. Although there has been no major breakthrough, he is quietly confident that leading players want to move the process forward and has not ruled out a return visit in the new year.

Mr Blair identified three priorities - giving the Palestinian president the capacity to improve the lives of the Palestinian people; an early meeting between Palestinian and Israeli leaders and relaunching the political process leading to a two-state solution.

Yesterday Mr Blair rejected criticism that he has no real influence on the Bush administration and warned that Britain would pay a "very heavy price" if it distanced itself from the United States. He hit back after a scathing report by Chatham House, the influential foreign affairs think-tank, said he had been unable to influence George Bush in any significant way and called on the next prime minister to rebalance foreign policy towards closer links with Europe.

An unrepentant Mr Blair said: "Britain having a strong relationship with the US has been a cornerstone of our policy for years and my view is if we give it up because we come under pressure from parts of the media or public opinion, we will pay a very heavy price."

He argued that progress in the Israel-Palestine peace process would not be possible without America.