Former US president Bill Clinton on Thursday urged Israel to make peace with the Arabs, saying the Jewish state will never have a better partner than the current Palestinian leadership.

Clinton spoke for an hour before an adoring audience of global leaders from business, government and academia at the World Economic Forum in Davos, Switzerland.

"If I were in Israel and I had any influence, I'd want to make that deal now," he said. Referring to a comprehensive peace offer mooted by the Arab League in 2002, he said: "All these countries have offered Israel a political, economic and security partnership, not just peace, not just normalization ... but a genuine partnership." In Palestinian Authority President Mahmoud Abbas, Clinton said, "they've got the best partner in the West Bank that they've ever had."

"All these things should make peace more likely... Can anyone imagine the Middle East or in particular the Israelis and Palestinians, will be better off if we do not do this now?"

The sides seemed tantalizingly close to a deal in Clinton's last days as president, when he mediated actively in 2000 and 2001, but talks fell apart and the sides went through some four years of deadly violence.

Various efforts since then have failed.

Clinton said he believes the public on both sides would support an agreement, and he professed to be "struck how ... political systems continually produce governments" that go against what "all public opinion polls show would be popular."

Clinton noted that the Arab world was currently in some turmoil, after the revolution in Tunisia and given the anti-government rioting in Egypt.

"It is a manifestation of the yearning for change and accountability and shared progress moving throughout the world, particularly throughout the Middle East and North Africa ... to be part of a modern world that works," he said. This, too, should "animate the parties to make a peace agreement" that could yield economic benefits for all sides, Clinton argued.