The London-based International Institute for Strategic Studies (IISS) said in its annual review of world affairs that governments need to do more to tackle a resurgent Al-Qaeda as well as limit the damage from global warming.

Its 400-page "Strategic Survey" report assessed that global events from May 2006 to June 2007 had been "discouraging" and the world was approaching "key turning points" in a number of international crises.

But at the same time, shifts in the balance of power plus a weakened United States on the world stage due to its post-war policy in Iraq, suggested little will be resolved in the coming 12 months.

"The world in 2008 will be doubly consumed by the politics of parochialism -- sectarian rivalries and religious disputes -- and by the manoeuvres of balance of power politics -- alliance politics and arms races," it said.

"In Europe, the United States and Asia big powers will talk to each other about that role, status, alliance, deterrence, containment, balance of power.

"In the meantime, groups around the world will fight those states and alliances... In this 'non-polar' world, the space for aggressive non-state actors to advance their particularist strategic aims has grown."

Specifically the IISS warned that 2008 "will see the dawning of a new nuclear age" if Iran's suspected atomic weapons programme is confirmed, forcing an international response to countries that try to follow suit.

As a result, international policy on Iran will need "very refined attention" particularly on building a consensus, the analysts said.

On Islamist extremism, the IISS said the United States and its allies had fundamentally failed to deal with Al-Qaeda since the September 11, 2001 attacks and that the ideology inspired by Osama bin Laden was now deeply entrenched.

Extremism was being fuelled by the sectarian bloodshed in Iraq, US policy such as its detention camp at Guantanamo Bay in Cuba and "extraordinary rendition" of security suspects for questioning in a third country, it said.

And evidence of Al-Qaeda's reach was seen in the "growing trend towards radicalisation within the Islamic world", particularly in Europe, and the affiliation of smaller jihadist groups like those in north Africa to the cause.

"The threat from Islamist terrorism remains as high as ever, and looks set to get worse," the IISS said, pointing to a number of foiled alleged attacks in Europe in the last 12 months.

"The organisation's ideology appears to have taken root to such a degree that it will require decades to eradicate."

In response governments needed to do more to encourage interaction between non-Muslims and Muslims and greater integration of ethnic minority groups, it assessed.

On global warming, the analysts assessed that although there was growing, but still not universal, recognition that the problem exists and may be man-made, urgent action was needed to tackle the rise in harmful emissions.

Unchecked, the effects will be "catastrophic -- on the level of a nuclear war -- if not in this century, certainly in the next", they said in a 23-page assessment of the fall-out from the rise in the Earth's temperature.

Climate change has important effects for global security, the IISS said, as it could potentially increase migration, water and food shortages and exacerbate existing flashpoints and tensions, particularly in Africa.

In a stark warning, it said action taken in the next few years will determine whether the second half of the 21st century will see instability, human tragedy and war, or an easing of and adjustment to climate change and a new emphasis on greater international co-operation.

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