Tony Blair has said that Britain's foreign policy should be based on "progressive pre-emption".

In a keynote address on the state of global affairs, the prime minister outlined a series of measures to reform the international system.

And he acknowledged the Iraq war had "split the world".

But the international community should support the country's fledgling democracy, Blair argued.

And he set out his vision for tackling international terrorism.

"The answer to terrorism is the universal application of global values," he said.

"The answer to poverty is the same. Without progress - in democracy and in prosperity - security is at risk. Without security, progress falters.

"That is why the struggle for global values has to be applied not selectively, but to a global agenda.

"The agenda is there. It is largely agreed. But it needs passion as well as policy."

Idealism

Giving a speech on foreign policy in Washington DC, Blair insisted he remained committed to his values despite the controversy over Iraq and Afghanistan.

"In my nine years as prime minister I have not become more cynical about idealism," he said.

"I have simply become more persuaded that the distinction between a foreign policy driven by values and one driven by interests, is obviously wrong.

"Globalisation begets interdependence. Interdependence begets the necessity of a common value system to make it work.

"In other words, the idealism becomes the real politik.

"None of that will eliminate the setbacks, fallings short, inconsistencies and hypocrisies that come with practical decision-making in a harsh world.

"But it does mean that the best of the human spirit, that which, throughout the ages, has pushed the progress of humanity along, is also the best hope for the world's future.

"Our values are our guide. To make it so, however, we have to be prepared to think sooner and act quicker in defence of those values - progressive pre-emption, if you will.

"There is an agenda for it, waiting to be gathered and capable of uniting a world once divided. There wouldn't be a better moment for it."

Reform

While most of the speech was devoted to Iraq, Blair also said that wherever possible the West should work to expand democracy and free speech, including in Iran.

He stressed change would not be imposed on Iran, but said it was in the interests of the world that Iranians achieve "the greater freedom which I have no doubt most Iranians want".

He called for the reform of international institutions like the United Nations security council to better adapt it to modern global challenges.

And he suggested a merger of the International Monetary Fund and the World Bank to help developing nations.

Turning to the Middle East peace process he again urged Hamas to recognise the state of Israel and said he hoped to see a "speeded-up pathway to final status negotiations".

He also suggested considering a multi-lateral system for providing countries with enriched uranium, to allow them to develop nuclear power without the risk of building nuclear weapons.

"The scale of this agenda is enormous," said the prime minister.

"It means that today's leaders of nations must analyse, cope with, deal with, a vast array of international problems as well as the myriad of challenges thrown up by each of our systems of healthcare, pensions, welfare, law and order.

"Except that, these problems are no longer simply international. They intrude into domestic politics. There is globalisation in politics, too."

Iraq

Blair said the birth of democracy in Iraq had ramifications far beyond the country's borders, urging the West to act as "champions of change" across the Middle East.

He said: "The governments of the world do not believe in freedom, but the people of the world do."

Blair, who has admitted the decision to remove Saddam Hussein had been deeply divisive, called for a "new concord to displace the old contention".

"If Iraqis can show their faith in democracy by voting for it, shouldn't we show ours by supporting them?," he said.

"The war split the world. The struggle of Iraqis for democracy should unite it."

He said that Iraq "has an importance far beyond the borders of Iraq".

"But I would put it higher than this. I now think that we need a far more concentrated and concerted strategy across the whole region," he said.

"The United States rightly began this with its Broader Middle East Initiative.

"However, the more I  examine this issue, the more convinced I am, that to protect our future, we need to help them to theirs.

"For example, I don't believe we will be secure unless Iran changes.

"I emphasise I am not saying, we should impose change. I am simply saying the greater freedom and democracy which, I have no doubt, most Iranians want, is something we need.

"There is a choice being played out in the region; to be partners with the wider world; or to be defined in opposition to it.

"If Iran leads the latter camp, the results will be felt by us all.

"The most effective way of avoiding that is to encourage and support all nations and people in the region who share our belief that freedom is the best route to peace and prosperity.

"This cannot and should not be the responsibility of the United States alone.

"The EU, in particular, needs to be fully engaged. But country by country, in every way we can, with every means we can properly deploy, the international community should be the champions of those who want change there.

"And wherever those who strive for that freedom are in danger, we should be at their side."