“What has been achieved is remarkable, but not yet complete,” Prime Minister Tony Blair said in Belfast alongside his Irish counterpart Bertie Ahern, adding that he was determined to “finish the journey” and resolve the deadlock.

Prime Minister Blair’s announcement followed efforts by Dublin and London to revive the peace process by getting the main Protestant group, the Democratic Unionist Party (DUP), to agree to share power with the main Catholic party Sinn Fein, the political wing of the Irish Republican Army (IRA).

The main stumbling block remains the DUP demand for photographic documentation of the disarming of the IRA — a demand which Sinn Fein feels is intended by the DUP to “humiliate” the paramilitary group.

Prime Minister Blair refused to concede failure, saying there was “inevitability in the process that is now locked in.”

Irish Premier Ahern, Mr Blair’s partner in bringing Protestants and Catholics together under the 1998 Good Friday peace accords, urged the two parties to remain engaged, despite the hardline DUP’s refusal up to now to even sit down at the same negotiating table with Sinn Fein.

“As we maintain our efforts on this initiative, everybody needs to play their part in creating a climate that is conducive to getting matters over the line,” the Irish leader said, suggesting that agreement could still be found before Christmas.

He rejected the idea that photo-documenting disarmament would humiliate the IRA, saying: “The forms of transparency that are proposed in the government’s proposals… have nothing to do with surrender or humiliation. Certainty and clarity are two-way streets.”

An Irish source close to the talks, which gained momentum for weeks until crashing late Tuesday, said the impasse over IRA arms was “symbolic of a lack of trust” between the archrival parties.

“The deal was there, but there was a psychological gap,” he said.

DUP leader Reverend Ian Paisley, a firebrand 78-year-old preacher, blamed Catholics for upsetting the deal and reviving the semi-autonomous regional government which was suspended in 2002.

“The IRA are dead set on keeping their arms … along with their two-fold policy of IRA aims of democracy and terrorism,” he said.

The proposals made public by Mr Blair and Mr Ahern included a timeline for completing IRA decommissioning by Christmas and setting up the new Northern Ireland executive in March next year.

They also detailed proposed police reforms, another thorny issue meant to address long-standing Catholic concerns about the fairness of what has long been a Protestant-dominated police force in the province.

The prime ministers also released a draft statement by the IRA showing a major shift by the paramilitary group away from armed combat.

“The IRA leadership is determined to support this comprehensive agreement,” it read.

“The all-Ireland nature and implementation on an enduring basis of this agreement… enables us all to take political objectives forward by peaceful and democratic means.”

Despite upbeat noises from Mr Blair and Mr Ahern, the fresh optimism over the deal was diluted, as Northern Ireland looked set to remain without its government at the New Year.

The power-sharing executive and assembly created by the Good Friday agreement were suspended in October 2002 amid allegations of IRA espionage.

Elections for a new assembly in November of the following year swept the DUP and Sinn Fein into power, overtaking more moderate political parties, but neither has been able to exercise power.

Mr Blair has been eager to resolve the deadlock before the New Year, when his attention will be focused on an expected general election and the British presidencies of both the Group of Eight and the European Union.

“We have not, at the present anyway, found agreement,” he said in Belfast, adding however that “I don’t think people should be cynical in Northern Ireland” about their political future.