Former British Prime Minister Tony Blair has launched a Faith Foundation on Friday with the aim of improving understanding between different religions and fighting global poverty by mobilising people through faith.

"Religious faith will be of the same significance to the 21st century as political ideology was to the 20th century," Blair said in a statement before Friday's launch in New York.

"In an era of globalisation, there is nothing more important than getting people of different faiths and cultures to understand each other better and live in peace and mutual respect," he said.

Blair, who converted to Catholicism in December after stepping down as prime minister in June, was often reticent about his faith during his 10 years in power in Britain, where religion and politics rarely mix.

Time magazine, which published an interview with Blair on Thursday, said the foundation aimed to build up a "war chest" of several hundred million dollars to fund projects to fight global poverty, such as an anti-malaria campaign.

It aims to support the UN Millennium Development Goals, a set of targets adopted by world leaders in 2000 to reduce hunger and halve extreme poverty.

"Tony Blair has argued that faith has to be rescued from those who would use it to divide and those determined to write it off as an irrelevance," the statement from his office said.

"By stressing the values of respect, justice and compassion which the great religions hold in common, he believes faith can help unite the world and shape its direction for the better."

It said in the first three years of the Foundation, priority would be given to encouraging inter-faith initiatives to tackle global poverty and to improve understanding of the great religions through education at every level.

Blair, whose wife and four children are Catholic, converted from Britain's established church, Anglicanism, to Roman Catholicism, in December. He held private talks with Pope Benedict at the Vatican last year.

In a BBC documentary last year he spoke about the importance of his faith, adding that while politicians could speak about religious faith in the United States, it was difficult to do so in Britain because "frankly people do think you are a nutter (crazy)".

Blair, a part-time international envoy for Palestinian economic development, is due to start teaching at Yale University in Connecticut in September, leading a course on "faith and globalisation".