Talks between UK Prime Minister Tony Blair and Syria's Bashar al-Assad have been described as "realistic and constructive" by the Syrian president.

In a joint press conference, President Assad said there were differences between the two countries, but stressed "we were in agreement on most basic issues".

Cherie Blair greets Mrs Assad

Mr Blair also stressed there were clear differences in "views and emphasis" over Iraq, but he said a "process of engagement with Syria is the right way forward".

On Iraq, President Assad stressed the importance of the United Nations resolutions.

He also denied supporting terrorism, saying alleged Palestinian terror groups based in Syria were "press offices" which were simply speaking up for the Palestinian people.

He said Syria was a country with a long history of fighting terrorism and "we put our experience at the disposal of any country who seriously wants to fight terrorism".

On Iraq, Mr Blair said he believed Baghdad had so far shown "good co-operation with the UN weapons inspectors and expressed his hope that war could be avoided".

He emphasised that Syria, like Britain, had backed the latest UN security council resolution on weapons inspections.

"What this means is to give the inspectors the opportunity to do their job properly," he said.

"I don't think it is our job to expect, or not to expect, but I am optimistic now."

Weapons inspectors

Mr Blair refused to be drawn on reports that the government believed that Iraq had failed to make a full declaration of its weapons of mass destruction in its dossier presented to the UN on 7 December.

"Our position on the report is that we simply have to study it. We have not completed our study yet," he said.

He said also the government would want to see the report of the chief UN weapons inspector Hans Blix before reaching any conclusions.

Mr Blair later told MPs he would invite Palestinian leaders to London in January as part of an effort to support Palestinian reforms and move the Middle East peace process forward.

Extremists

President Assad's meeting in Downing Street is the first time a Syrian leader has paid an official visit to the UK.

On Tuesday, Mr Assad is due to visit the Queen in Buckingham Palace.

Writing in Monday's Financial Times, Mr Blair said that Syria's vote in favour of UN Resolution 1441 on disarming Iraq was a sign of the success of dialogue with President Assad.

But he cautioned that Britain remained concerned about the continuing presence in Damascus of extremist Palestinian groups.

"I believe you cannot be anything other than 100% against terror and will say so today," said Mr Blair.

'Disappointing'

The UK and Syria hold diametrically-opposed views on possible military action against Iraq, with President Assad warning the UK not to join a US-led war against Iraq, arguing it would simply create "fertile soil" for terrorism.

Syria backed the latest UN resolution on Iraq

UK Government officials have described as "very disappointing" Iraq's dossier on its weapons programme, presented to the UN a week ago.

Sources quoted by the Financial Times said that the dossier failed to account for chemical and biological material which was missing when UN inspectors were last in Baghdad four years ago.

Iraqi leader Saddam Hussein "has missed an important opportunity", the sources said.

Peace process

The last meeting between Mr Blair and Mr Assad, in Damascus last year, was remembered for the frosty atmosphere at their joint news conference.

Mr Blair says another issue he will raise is Syria's trade links with Saddam Hussein's regime.

Middle East analyst Rime Allaf told the BBC that the UK had done well to keep dialogue open with Syria, despite the last meeting between the two leaders.

"But what did happen behind closed doors is that there are a lot of points in common between Syria and Britain about the Middle East which are points of view that differ from the US."