The prime minister has warned that all European countries face the threat of terrorist attacks.

In a Commons statement in which he praised the success of NATO's Prague summit, Tony Blair said that adopting a soft or hard line against the terror threat would make no difference.

"The terrorists do not distinguish between the soft or hard nations on terrorism.

"Every European country knows that it is under threat, whether known as strong supporters of the US policy or not," Blair warned.

The war on terrorism "is not a war, therefore, that we can avoid".

"There is no appeasing these fanatics. They won't go more lightly on us if we are less outspoken in our condemnation of them."

Commenting on the expansion of NATO into central and eastern Europe, Blair predicted that more countries would join in future.

"These invitations will not be the last," he told MPs.

Blair said that the new members could teach the west much about the principles of freedom, peace and democracy that NATO was established to defend.

There was also a welcome for NATO plans to improve its capabilities to meet "new challenges".

The prime minister also said there was agreement on strong action against Iraq, and an acknowledgement that the multilateral approach and the United Nations must be seen to work.

Duncan Smith said the expansion was a step in the right direction.

"Its positive for them and its positive for us."

But he warned that European nations need to step up defence spending to improve their capabilities.