With the rest of the G8 members and heads of emerging countries standing shoulder to shoulder behind him, Mr Blair said: "There is no hope in terrorism, nor any future in it worth living. It is that alternative to this hatred that we offer. This is in contrast to the politics of terror."
Mr Blair warned that the terrorists' goal was to spread "despair, anger and hatred" in Britain, and he reinforced appeals to prevent a backlash against the Muslim community.
Mr Blair insisted that the deal agreed at Gleneagles would provide hope for Africa and the world that would not be eclipsed by the terrorist attacks.
As Mr Blair flew back to London to chair a meeting of Cobra, the emergency committee on the bombings, a senior official said it was important to let the police and intelligence services get on with tracking down the terrorists. "There will be a time later to discuss these things," he said.
Mr Blair rejected any attempt to lay blame for the bombings on intelligence and security failures, insisting that the blame lay squarely with the terrorists.
Ending the G8 Summit, Mr Blair was asked about the failures that had allowed the bombers to succeed. "I think those people who kill the innocent and cause bloodshed are ... solely responsible," he said.
Mr Blair said the G8's final communique would not match the "ghastly impact of the cruelty of terror".
However, he said: "It has a pride, and a hope and a humanity at its heart that can lift the shadow of terrorism and light the way to a better future.
"That is why we are convinced that the politics we represent will triumph over terrorism."
The G8 endorsed a statement committing the world leaders to united action on counter-terrorism. It said they were "united in condemning in the strongest terms the terrorist attacks".
Collectively the G8 leaders said their countries were "developing a common understanding of the threat" and assessing links between crime and terrorism. "As terrorists operate flexibly and internationally, so must we. Government, police and intelligence responses must be more effectively co-ordinated," said the statement.
Ken Livingstone, the Mayor of London, insisted that every major city in the world faced the threat of terrorism, and rejected suggestions that Thursday's attacks were the result of the war in Iraq. He said: "It's simply a criminal attempt at mass murder."
Mr Livingstone said a book of condolence would be opened at City Hall on Monday, while an appeal, the London Bombings Relief Fund, would be established to raise funds for the victims of the attacks and their families.
In a message to the attackers, he declared: "Watch next week as we bury our dead and mourn them but see also on this same day, new people coming to this city to make it their home and calling themselves Londoners and doing it because of the freedom to be themselves."
But George Galloway, the left-wing MP for Bethnal Green and Bow, called on Mr Blair and US President George Bush to resign. He said: "If we allow this despicable act of mass murder to be used as justification for more despicable acts of mass murder visited by us on them they will seek to inflict another act of mass murder on us and that dismal cycle of death and destruction will continue."
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