Fuad Siniora, the Lebanese Prime Minister, urged the tens of thousands of citizens who fled during the recent conflict to return to their country after Israel lifted the final part its eight-week blockade today.

"Lebanon is breathing again," proclaimed Mr Siniora in a televised statement as European warships began patrolling the Lebanese coast after Israel lifted its naval stranglehold, 24 hours later than planned.

The Prime Minister called on citizens and Arab tourists who left in droves "to come back to the Lebanon you love."

The United Nations Interim Force in Lebanon (Unifil) took control of the waters at 12.30pm local time (9.30am GMT) and the blockade was lifted at the same time. Flights to and from Beirut resumed last night and Israeli pledged to withdraw all its troops in the next two weeks.

"The UN naval force led by Italy has taken control of the sector in complete co-ordination with the Israeli military and will be implementing the embargo on arms intended for Hezbollah," said a spokesperson for Ehud Olmert, the Israeli Prime Minister.

The Unifil head, Major General Alain Pellegrini, said in a statement: "The blockade has seriously undermined the Lebanese economy and it is high time for it to end so as to allow the people to get back to their businesses."

The move lifts a blockade that stifled Lebanon and cost it millions of dollars a day as it tried to rebuild from Israel's devastating 34-day battle with Hezbollah.

Israel sealed off Lebanon by air and sea when the war began on July 12 to keep Syria and Iran from supplying Hezbollah with arms.

In a further boost to the UN ceasefire, Israel announced that it would aim to withdraw the last of its troops from Lebanon by the start of the Jewish New Year on September 22, as a combined force of 15,000 Lebanese soldiers and an equal number of UN peacekeepers move into southern Lebanon.

Hundreds of Lebanese troops moved into a corner of southwest Lebanon, the latest area from which Israeli forces withdrew. Dozens of camouflaged Lebanese military trucks and armoured vehicles lined a busy coast road in Mansouri, about 25km north of the border with Israel.

Israel lifted its restrictions on air travel last night and several international and Arab airlines announced that services had returned to normal. In a symbolic act a commercial flight by Lebanon's national carrier Middle East Airlines circled over downtown Beirut three times, just four minutes after the embargo ended.

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