President George W. Bush on Friday pledged to seek the establishment of a Palestinian state by the end of his term of office, but issued a fresh demand that it must be a democracy.

“I believe we've got a great chance to establish a Palestinian state, and I intend to use the next four years to spend the capital of the United States on such a state,” Mr Bush said after meeting Tony Blair, the British prime minister, at the White House.

Asked whether he would realise his vision in the course of his second term, Mr Bush added: “I hate to put artificial time frames on things . . . [but] I'd like to see it done in four years.”

After two days of talks with Mr Blair, the first world leader to visit the White House since Mr Bush's re-election, the president also signalled his willingness to heal the transatlantic relationship damaged by the Iraq war, announcing he would like to visit Europe early next year.

On the day that Yassir Arafat's life was remembered in Cairo and his body buried in Ramallah, the two most outspoken advocates of the Iraq war pledged to use their alliance to forge a lasting peace between two separate Palestinian and Israeli states.

But Mr Blair, who came to Washington with a number of specific strategic initiatives in mind, appeared to have wrung little by way of concrete commitments from Mr Bush.

Mr Bush left open the possibility of a future Middle East peace conference, even sounding ambivalent about the idea. “I'm all for conferences just so long as the conferences produce something,” he said.

Mr Bush declined to say whether he planned to send an envoy to the Middle East and avoided the question of whether he would call on Israel to freeze settlements in the West Bank.

Instead, Mr Bush and Mr Blair sought to emphasise that the election of a new Palestinian president to succeed Mr Arafat was the first step in the development of a functioning democracy itself a prerequisite of statehood.

“The Palestinians may decide to elect a real strong personality, but we'll hold their feet to fire to make sure that democracy prevails, that there are free elections,” Mr Bush said, adding that without democracy “I will be extremely doubtful that [peace] will ever happen.”

The emphasis on democracy marked a shift in the language used by both men in setting out the terms of a Palestinian state.

Mr Bush described a future Palestine as a “democratic, independent and viable state”.

In his letter to Ariel Sharon, Israeli prime minister, Mr Bush spoke of a “viable, contiguous, sovereign and independent” state.

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