Davos: The continuing violence and the facts on the ground are stopping progress to a peace deal in Palestine, Tony Blair, former UK Prime Minister and Quartet Special Envoy to Palestine, said.

The terms of a possible future deal are largely clear, but the continuing Israeli actions and "their effects on the Palestinians mean that no one on the ground believes that any deal can be made real", Blair said.

Because of the emerging consensus based around the two-state solution, Blair thought that the Annapolis process might arrive at a deal, but was much more doubtful that it could be made to stick, thanks to the continuing violence.

"The Palestinians have to deal with the impact of Israel's continuing occupation, the soldiers, the road-blocks, and peace will only happen if the facts on the ground change," he said

"We have a collision between the facts which people see every day, and the possible plans for peace. Talking at the closing session of the World Econ-omic Forum in Davos, Blair rated peace in the Middle East as one of the most important requirements for improving the state of the world.

He and others on the panel listed what they see as important to achieve during 2008, in the light of the discussions in Davos. In addition to seeking peace, their priorities tackled various aspects of building international plans to deal with global issues like climate change, efficient used of energy, or better use of water resources.

The importance of an energy and environmental policy with specific targets was the priority for James Dimon, Chairman and CEO of JPMorgan Chase, and restarting the Millennium Development Goals was the top priority for Indra Nooyi, Chairman and CEO of PepsiCo.

The whole panel made very clear that while they see the global economy as a reality, there is a dangerous disconnect with people's values which are defined by their regional cultures, and with the world's regulatory authorities which remain stuck at the national level.

They saw this as a problem which contains the imminent danger that unless action is taken, people will react badly to the effects of globalisation, feeling that it is "something happening to them, rather than something they are taking part in," as Nooyi put it.

Asian power

"The shift of economic power to Asia, and the newly emerging importance of India and China is something with which the West will need to feel comfortable," said Dimon.

"Globalisation is a fact, but its values are still a choice to be made. At an international level, political leaders should make clear that the international values that should go with the global economy are based on justice and freedom, and are not about exploiting people," said Blair.

"There is a long way to go to reassure people across the globe that these values are part of globalisation, and the economic changes are not a threat, but are happening in the spirit of making the world a better place for all," said the former prime minister.