The former president of the World Bank has pulled out of a speech at the American University of Beirut because of pressure from anti-Israel activists.

Australian-born Sir James Wolfensohn, who is Jewish, was due to speak at the AUB graduation ceremony on June 25 and be awarded an honorary doctorate.

But the university decided to revoke the doctorate after staff and students launched a petition against honouring him because of his ties with Israeli businesses.

Sir James, who led the World Bank from 1995 to 2005, was appointed as a special envoy for the Quartet on the Middle East five years ago, a role in which he oversaw Israel's disengagement from Gaza. He left the post a year later because of disagreements over how to engage with an elected Hamas.

His philanthropic work, including for multiple sclerosis charities and on sustainable development, has won him plaudits around the world.

But the AUB campaigners said: "Honouring Mr Wolfensohn... symbolically undermines AUB's legacy in the struggle for social justice and its historical connection to Beirut, to Palestine and beyond."

In a statement the university expressed regret that Sir James had decided not to attend the ceremony "out of concern that his presence at the June commencement ceremony would distract from the celebratory nature of the event".

The decision was publicly criticised by the AUB president Peter Dorman, who defended Sir James' record of support of the Arab world in a public letter. "The Arab world needs more friends like him," he said.

Sir James will however be honoured by another Middle Eastern university. He is one of ten people who will receive honorary degrees from the Hebrew University of Jerusalem on Sunday.

The university said Sir James, 77, was "a highly respected figure in the worlds of finance, world development and diplomacy".

They added: "Wolfensohn is a loyal friend and energetic supporter of Israel, whose concern is reflected in his resolute commitment to bringing peace to Israel and its neighbours.

Trevor Pears, the chairman of the UK-based Pears Foundation, will also be honoured "in recognition of his outstanding commitment to social justice and in tribute to his profound friendship for Israel and the Hebrew University."

Mr Pears is one of Britain's most prominent funders of Jewish and Israel-related causes. He was made CMG (Commander of the Order of St Michael and St George) for services to the community and UK/Israel relations at the beginning of this year.