Tony Blair has spent the last five days as one of the Co-Chairs of the World Economic Forum in Davos, focusing on his core concerns of: his role in the Middle East; providing a solution to the challenge of climate change; development and capacity building in Africa; and promoting the work of his Faith Foundation, which is due to launch later in the year.

Speaking at the closing session, hosted by CNN, Mr Blair stressed the crucial role of economics in ending conflict, having held meetings during the week to encourage investment to help the Palestinians.

"If there is economic development then the politics is easier. If the people are poor and miserable then it is harder," he said.

"President Bush is right, you could have a deal within the year. I mean I'm not saying that's it's going to happen but I think it's perfectly feasible to contemplate that but it's only going to happen if the facts on the ground change.

Speaking in the wide-ranging debate on current global challenges, Mr Blair said: "The good news about our world today is that idealism is the new realism and the reason for that is the interconnectedness."

Tony Blair added that he was confident efforts to tackle climate change would bear fruit, "but no one should underestimate the scale of the challenge."

Watch Tony Blair in CNN debate at Davos HERE