Tony Blair has urged the world powers to "seize this opportunity"

Mr Blair welcomed the plan as an "important step" towards peace in the Middle East.

He said the global community should now "seize this opportunity to inject new life into the peace process in accordance with the roadmap".

The 2002 Middle East roadmap was agreed by the US, UN, EU and Russia.

The "disengagement" plan envisages Israel uprooting all settlements on the Gaza Strip but holding on to six blocs in the West Bank.

West Bank settlers (not including East Jerusalem): 240,000 Settlement block populations: Maale Adumim - 30,000 Ariel - 18,000 Kiryat Arba - 4,000 Hebron enclave - 500 Givat Zeev - 10,000 Gush Etzion - 30,000

Mr Blair's statement continued: "We all want to see a comprehensive peace agreed by the two sides leading to two states, Israel and Palestine, living side by side in peace and security,

"Israeli withdrawal should be an important step toward that objective."

Mr Blair said the Palestinian Authority must now "show the political will to make the withdrawal from Gaza a success and to deliver on the roadmap responsibilities, especially regarding security".

He said he would discuss the development with UN Secretary General Kofi Annan in New York on Thursday and with President Bush at their talks in Washington on Friday.

President Bush described Mr Sharon's move as "historic and courageous".

But the Palestinians said Mr Sharon's plan violated international law, which viewed the Israeli occupation of the West Bank, Gaza Strip and Golan Heights as temporary.

Palestinian Prime Minister Ahmed Qureia criticised Mr Bush's stand: "He is the first president who has legitimised the settlements in the Palestinian territories when he said that there will be no return to the borders of 1967.

"We as Palestinians reject that, we cannot accept that, we reject it and we refuse it."

Palestinian negotiator Saeb Erekat dismissed Bush's statement and said: "This is like someone giving a part of Texas' land to China."

A statement from Palestinian leader Yasser Arafat's office said American endorsement of Mr Sharon's settlement plans "will settle the issues that were up for negotiation in the final-status talks and will lead to the destruction of... the peace process".

Mike Gapes, deputy chairman of Labour friends for Israel, said Mr Sharon's plan gives "the beginnings of a possibility" of some movement towards a two state solution for the Middle East.