Hillary Clinton has announced the first direct talks between Israel and the Palestinians in nearly two years.

The US Secretary of State invited Israeli prime minister Benjamin Netanyahu and Palestinian Authority president Mahmoud Abbas to Washington to resume negotiations in order to creat a "just and lasting peace."

Egyptian and Jordanian leaders have also been asked to attend.

Ms Clinton said that the talks, to take place from September 2, should be held without preconditions and added that the United States is fully committed to a two-state solution.

She said the talks should be "characterised by good faith and a commitment to their success, which will bring a better future to all of the people of the region,"

Ms Clinton said she thought that there could be an agreement within the next year and stated that the talks will cover issues including borders, the future of Jerusalem and refugees.

She added: "I ask the parties to persevere, to keep moving forward even through difficult times."

Special envoy George Mitchell said: “We do not expect all of the differences to disappear when the talks begin. We expect they will be discussed.

“We believe peace in the Middle East, including but not limited to an end to the conflict between Israel and the Palestinians, is very much of interest to all in the region.”

He said the talks would proceed with “patience, perseverance and determination.”

Mr Mitchell thanked a number of countries including Egypt and Jordan for being “very helpful” in bringing the two sides back to the negotiating table, and praised the efforts of the Quartet, EU foreign minister Baroness Ashton and the UN.

Israeli Prime Minister has repeatedly said Israel is ready to come to the negotiating table but Palestinian president Mahmoud Abbas had rejected direct talks without a full freeze on construction in the settlements.

Face-to-face talks were last held in December 2008.

The Jewish Council for Public Affairs and the American Task Force on Palestine issued a joint statement welcoming the talks and praising the Obama administration for getting them back on track.

They said: “Both parties must now show courage, flexibility and persistence in order to move towards a negotiated end of conflict agreement.

"Both sides must take concrete steps in the short term to instill greater mutual confidence in this process and to demonstrate resolve to stay at the negotiating table as long as it takes to achieve an agreement.

"Israelis and Palestinians have suffered for far too long. It is time to make peace."

More on the peace process here