President Shimon Peres told world leaders on Wednesday at an interfaith dialogue in New York that the Arab peace initiative must be seriously considered as "a serious opening for real progress" in Middle East peace.

The proposal, initiated by Saudi Arabia in 2002 and ratified by Arab foreign ministers last year in Damascus, offers pan-Arab recognition of Israel in exchange for Israel's withdrawal from Arab lands captured in 1967.

(click here to read Peres' entire speech)

The goals of the initiative, Peres told delegates at the United Nations-hosted summit, was to "stop the further shedding of blood, enabling the Arab countries and Israel to live in peace and good neighborliness, and provide future generations with security, stability and prosperity."

"These expressions in the Arab peace initiative are inspirational and promising - a serious opening for real progress," he said.

"We cannot change the past," he said. "However, we can shape our future."

"This seems more feasible today in light of the Saudi proposal which evolved into a Arab peace initiative. The initiative's portrayal of our region's future provides hope to the people and inspires confidence in the nations," he added.

Peres told delegates to the conference that Israel's leadership was prepared to make the concessions necessary for a real political process to take force.

"A comprehensive regional peace requires the completion of the bilateral negotiations with the Palestinians and sharing the painful cost," he said. "We are ready for this as we have proved many times in the past."

"In order to stand up against those who instigate discord and violence, we must bear the flag of brotherhood and peace," Peres added.

Saudi king: Terrorism is the enemy of all religions

King Abdullah of Saudi Arabia, who had urged the United Nations to host the summit, opened the events on Wednesday by declaring that terrorism is the enemy of all religions and callingfor a united front to combat it and promote tolerance.

"We state with a unified voice that religions through which Almighty God sought to bring happiness to mankind should not be turned intoinstruments to cause misery," the king said.

"Terrorism and criminality are the enemies of every religion and every civilization. They would not have emerged except for the absence of the principle of tolerance."

The forum marks a new direction for Saudi Arabia, whose austere "Wahhabi" Islam came in for international criticism after the Sept. 11 attacks in 2001 on the United States, Riyadh's main ally and guarantor of security.

UN Secretary-General Ban Ki-moon hosted the opening dinner Tuesday night for leaders attending the two-day UN conference, intended to promote a global dialogue about religions, cultures and common values.

Arab leaders, including the Saudi king, and Peres attended the same dinner, a rare encounter that the head of the United Nations hopes will promote understanding and talks.

"It's quite unique when you expect President [Shimon] Peres of Israel ... and many kings and leaders from the Arab world ... [sitting] down together and having dinner," Ban told reporters.

The secretary-general told reporters he was not going to organize any meeting between the Saudi king and the Israeli president. Public meetings between Israeli and Saudi officials are extremely rare, and many Muslim countries, including Saudi Arabia, do not have diplomatic ties to Israel.