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Last Updated: Friday, 9 May, 2003, 19:46 GMT 20:46 UK
Bush offers Mid-East trade zone
President Bush speaking at the University of South Carolina
President George W Bush has announced plans for a US Mid-East free trade area within a decade as part of a drive for peace in the region.

He said the aim was to bring the Middle East within an expanding circle of opportunity and to reward nations that pursued broad political and economic reforms.

Mr Bush also talked about his determination to establish peace between Israel and Palestine.

The US president told an audience at the University of South Carolina that his proposals on trade would bring hope to the people who lived in the region.

He said the plan would ensure that small and medium-sized businesses had access to capital and that corruption and self-dealing would be replaced by free markets and fair laws.

Fighting terror

Mr Bush said he wanted Middle East nations to be able to benefit from the sort of economic prosperity that exists in many other parts of the world.

Economic changes that come with free trade can often be destabilising
Daniel Byman, Georgetown University
But he made it clear that before that could happen, the US wanted to see democracies, human rights and freedom around the world.

"Arab nations must fight terror in all forms and recognise and state the obvious, once and for all, Israel has a right to exist as a Jewish state at peace with its neighbours."

The president promised that America would work, without tiring, to ensure that the states of Israel and Palestine could live side by side in security, prosperity and peace.

Membership conditions

Some experts have cast doubt on the impetus any free trade deal would bring to the search for peace.

"Economic changes that come with free trade can often be destabilising" and could spark a backlash for governments averse to reform, said Daniel Byman, assistant professor at Georgetown University.

They could also "play into some conspiracy theories that the United States is trying to undermine the region," he added.

"The hope is that, over time, as economic bonds with the United States form, opinions will change."

The US already has free trade agreements with Israel and Jordan and wants to conclude a trade pact with Morocco by the end of the year.

US Secretary of State Colin Powell and Trade Representative Robert Zoellick will attend a World Economic Forum in Jordan next month where they are likely to discuss conditions for membership in the trade pact.

Mr Powell is also travelling to the Middle East this weekend and will hold separate talks with Israeli Prime Minister Ariel Sharon and Palestinian Prime Minister Mahmoud Abbas, more commonly known as Abu Mazen.

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