JERUSALEM — Prime Minister Blair gave the “green light” yesterday to initiatives designed to create thousands of jobs for Palestinian Arabs in his first major policy announcement as special envoy to the Middle East.

Speaking in Jerusalem, Mr. Blair said he would work with the Israeli defense minister, Ehud Barak, and the Palestinian Arab prime minister, Salam Fayyad, to encourage economic growth in the divided Palestinian Arab communities of Gaza and the West Bank. Mr. Blair, who has been international representative to the Palestinian Arabs since stepping down as British prime minister, sought to claim immediate credit for various projects including the creation of two industrial zones in the West Bank, saying his committee had given them the “green light.”

In reality, the projects, one at Jericho and the other near Hebron, were going ahead without the involvement of the new committee, fully funded by money donated by Japan and Turkey respectively. But Mr. Blair described the committee’s first session as a “strong beginning for what is a critical part of the whole process.” He added: “Without hope of prosperity, rising living standards, and an economic stake in the future for ordinary Palestinians, the politics will never succeed.”

The timing of yesterday’s announcement was crucial as it was intended to build momentum for next week’s Israeli-Palestinian Arab peace meeting at Annapolis, Md., by showing that economic progress was being made.

But Palestinian Arab investors — the people whose participation will decide ultimately whether the zones are a success — were disappointed after Mr. Blair’s announcement as he failed to provide any of the security guarantees that they were seeking.

Industrial zones have been tried before several times in the Palestinian Arab territories to try to stimulate employment but they have always failed because of Israel’s reaction to threats to its security.

Millions of dollars in private investment were attracted to two zones in Gaza, but today the one at Erez lies in ruins and the other at Karni has been mothballed after local investors made huge losses. The three-man committee has been trailed widely by Mr. Blair’s office.

It was first suggested last month as part of a plan of action to be called “The Rapid Effect Project” to try to ensure a swift and identifiable improvement in the living conditions of Palestinian Arabs. In this spirit, Mr. Blair’s committee dealt with Israeli security concerns that had stopped the completion of crucial renovation work at a sewage treatment plant in Gaza that flooded earlier this year killing five people.

Even though the World Bank had agreed to pay for the $16 million renovation project and most of the building work had been done, the project was being held up because Israel refused to allow components to enter Gaza. Israel feared they could be used by militants to manufacture rockets.

Mr. Blair said his committee had come up with the necessary reassurances for Israel and he had been given undertakings the components would be allowed in. America had hoped the Israelis and Palestinian Arabs would have agreed before the summit on key issues including the status of Jerusalem, borders and the rights of Palestinian Arab refugees.