"The way to stop Iran is by more effective sanctions," Livni told a news briefing after meeting with her Slovenian counterpart, Dimitrij Rupel, on a one-day visit to Ljubljana.

"Iran with nuclear weapon is something that the world cannot afford. It is clearly a threat to the region. ... While we are talking, here at this press conference, Iran continues with its enrichment activities," Livni said.

"The world must not loosen its grip," she warned. "Iran is constantly evaluating the reaction of the international community."

This week, a key US intelligence report said that Tehran halted a covert nuclear weapons programme in 2003, undermining years of statements by US President George W. Bush accusing Tehran of actively seeking a nuclear bomb.

The National Intelligence Estimate (NIE) said that US allegations about Iran's atomic goals had been overblown for at least two years, although it could have the capability to make a nuclear weapon by 2015.

The findings have divided world powers about how to get Tehran to come clean about the full scope and true nature of its disputed atomic drive, which Iran insists is entirely peaceful.

The United States and its Western allies argue that a third round of even tougher sanctions is needed to force Iran to halt uranium enrichment, a process used to make both nuclear power and, in a highly refined form, nuclear weapons.

Livni noted the common response to the report on Tuesday by the United States and the European Union, of which Slovenia will take over the rotating presidency on January 1.

But both Russia and China, who sit on the UN Security Council, suggest that the report downgrades Tehran's nuclear weapons risk and therefore lessens the need for additional UN sanctions.

Israel disagrees.

"The most crucial point in time is not the day of the development (of a nuclear weapon), but the day they master the technology. They are doing this in the violation of all the security council agreements," Livni said.

As well as meeting Slovenian counterpart Rupel in Ljubljana, Livni also held talks with president-elect Danilo Turk and ended the day by opening the country's first Israeli consulate.

One of the aims of Livni's visit to Ljubljana was to prepare for Slovenia taking over the six-month EU presidency.

She used her trip to present Israel's position on current regional issues to the incoming EU president and to find ways to strengthen the dialogue between Israel and the EU, she said.

With regard to the Middle East peace process, Livni said that the EU's role was to "support the (peace) process, not to dictate it."

Livni said that negotiations between Israel and the Palestinians later this month were "bilateral and will be held by the two sides alone."

International involvement in the direct negotiations was "not desirable," she said.

The international community, the European Union and the Arab world should support the negotiations, she said.

Slovenia's foreign minister also saw the visit as a means to "launch a mutual exchange of information" between Europe and Israel.

According to a statement issued by Livni's office in Jerusalem, she was to return to Israel on Wednesday.

She would then fly to Brussels on Friday for talks with her counterparts of the member states of the North Atlantic Treaty Organization.

Representatives of Algeria, Egypt, Jordan, Mauritania, Morocco and Tunisia will also attend the conference, her office said.

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