In a broadcast statement released to a series of Basque media outlets, the organisation listed as a terrorist group by the European Union and the United States, said it would lay down its arms from Friday.

Three sinister-looking figures in beige masks and Basque berets appear on the video, in which they state that Eta’s goal is to now "promote a democratic process... and to build a new framework in which our rights as a people will be recognised."

The organisation - which is committed to creating an independent state between northern Spain and south-west France - previously declared a full ceasefire in September 1998 but this was rescinded in December 1999.

The statement continued: "Eta has shown its desire and will that the process now begun should reach a conclusion and thus achieve true democracy in the Basque Country, overcoming long years of violence and constructing a peace based on justice.

"We reaffirm our commitment to continue to take steps towards this end. Here and now, it is possible to overcome the conflict. That is the desire and will of Eta."

Speculation about an end to Eta’s armed campaign has been building for several months, despite a recent wave of small-scale bombings against Basque businesses. Eta has not staged a fatal attack since May 2003, when a car bomb killed two policemen in the northern town of Sanguesa.

Jose Luis Rodriguez Zapatero, the Prime Minister, said last month that he was optimistic the group would declare a truce, which he had set as a condition for any further dialogue.

Many Spaniards believed that after the March 11, 2004, terror attacks in Madrid, carried out by Islamic extremists, support for Eta's terrorist activities would collapse as deadly violence became politically unthinkable.

Maria Teresa Fernandez de la Vega, the First Deputy Prime Minister, said that she hoped the statement marked the "beginning of the end” of violence.

“This is good news for all Spaniards. The government will work with all political forces to achieve peace," she said.

Artur Mas, leader of the Catalan nationalist party CiU, warned: “Experience has shown we should be cautious with ETAcommuniques. Terrorist violence has affected us all.”