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Prime Minister Tony Blair said Tuesday that his country must carry through its commitments in Iraq and Afghanistan in 2007 while he continues a personal quest to revive the peace process in the Middle East.

Most of Blair's New Year's message — likely his last as prime minister — was about domestic politics, however, clearly looking beyond his departure and urging his Labour Party to persist with his "New Labour" agenda. Blair has said he will leave office by September, but has not been more specific.

"The threat of global terrorism menaces us as it does other nations," Blair said.

"That is one reason why it is so important that we see through the battles in Iraq and Afghanistan where the British forces show day after day why they are the finest in the world," he said.

"I will keep my commitment to work tirelessly for the restart of the peace process in the Middle East," he added.

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Thousands of British soldiers are expected to be withdrawn from Iraq this year as they transfer control of two southern provinces to Iraqi forces, Defense Secretary Des Browne said in November. Some troops are expected to remain longer to train and support Iraqi forces.

Britain has around 7,000 soldiers stationed in southern Iraq, mainly based around the city of Basra. There are around 6,000 troops based in Afghanistan, the majority in the volatile southern province of Helmand, where more than 30 soldiers have been killed since June.

Blair embarked on a Middle East tour last month to try to encourage an Israeli-Palestinian peace settlement and cement a foreign policy legacy for himself that goes beyond his role as the chief U.S. ally in Iraq.

Reeling off a list of domestic concerns, including the National Health Service, education, crime and economic stability, Blair said Labour faced "the most difficult time for any government — nine years into power, midterm in a third term."

After a year of persistently trailing the resurgent Conservative Party in opinion polls, the Labour Party faces the most serious challenge to its authority — a challenge expected to fall on Treasury chief Gordon Brown, who so far faces no strong opponent in his path to succeeding Blair.

In his own New Year message, opposition Conservative leader David Cameron signaled his intention to annex more of Labour's center-ground territory.

"We must show that, unlike Labour, we will be a party that is for working people, not rich and powerful vested interests," Cameron said.

"With Blair going and Brown coming, we need to prepare ourselves for an onslaught of negative campaigning and the politics of fear and division," Cameron added.

Blair, reflecting fears among some Labour activists that Brown will tilt the government to the left, urged the party not to lose sight of the middle ground.

"This isn't just about policy, though it is certainly about taking the tough decisions that prepare Britain for the future," Blair said.

"It is also about our instincts, our ability to keep the core coalition together: those who need our help to get on the first rungs of the ladder of opportunity; and those who are already there but aspire to do better still."

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