Irish Taoiseach Bertie Ahern has addressed the Welsh Assembly as part of his St David's Day visit to Wales and held out the promise of a "new and exciting era of partnership" between Ireland, the UK and its regions.

Regretting the cancellation of the Wales-Ireland rugby international, he said "We could not take the risk of the further spread of Foot and Mouth outbreaks and the consequent threat to the livings of our farming communities, already hard pressed by the effects of BSE on consumer confidence."

However, following discussions on the troubled peace process with Tony Blair on Wednesday, he used his speech to set out the benefits of increased cooperation that had resulted from the Good Friday Agreement. The Agreement has "changed our political landscape forever," he said, with a "fair and just political accommodation" for the two main traditions.

Praising the "unique forum" of the British-Irish Council he noted that while Ireland was taking the lead in discussions on the misuse of drugs, Scotland and Wales were addressing issues of social inclusion within the Council.

Turning to Ireland's recent economic success story, which has seen average annual growth rates of 8 per cent, Ahern said he was "delighted to note a new proactive approach to mutually beneficial economic relations, strongly led by Rhodri Morgan."

"Wales is looking towards a future filled with promise. We, your neighbours in Ireland, look forward to sharing that future with you in friendship and cooperation, and to working together to forge a new relationship for a new era," he concluded.

Commenting earlier, Rhodri Morgan said: "We share so much in common with Ireland and cast envious glances at the way in which the country has developed one of the fastest growing economies in Europe. Objective 1 funding from Europe gives us the opportunity to emulate our Celtic cousins."