SECRETARY RICE: Well, I'm pleased to be here in Egypt and shortly in Saudi Arabia with Secretary of Defense Bob Gates. The President asked us to come out to the region to affirm to our allies and friends in the region the enduring commitment of the United States to security and stability and progress in the Middle East. We've had very good conversations about what initiatives we might take with our friends and allies for future security cooperation in these challenging times.

We've also had very intensive discussions about the various political issues facing the region. This morning, earlier at the GCC plus Egypt and Jordan, we had extensive discussions of the Israeli-Palestinian issue, of Iraq, of the situation in Lebanon, and other political issues.

And finally, we've had extensive discussions and just finished discussions with President Mubarak and then with Egyptian officials about the important work that we are doing in Iraq and assuring our friends and allies that the policies and decisions that the President is pursuing in Iraq will be policies and decisions that have, at their core, an understanding of the fundamental importance of a stable Iraq to the stability of this region. And that will be very much on his mind, a priority for him as he looks over the next several months to the report that he will be receiving from General Petraeus and Ambassador Crocker.

I think it's fair to say that we have had discussions that are befitting for longtime strategic allies in the region and we will continue to do that. Bob, do you want to add anything?

SECRETARY GATES: No, why don't we just go straight to questions.

. . .

QUESTION: We've heard voices from Iranian officials (inaudible) trip, as sort of a diplomatic shot across their back, (inaudible).

SECRETARY GATES: I think this trip is very much just as Condi described it. We are out here to talk about the long term, that the United States has been in this region and in the Gulf specifically for some 60 years. We have every intention of being here for a lot longer. We have some very long-term friendships and security relationships out here. We are here to reassure all of our friends that we intend to carry out those responsibilities and that we will continue to be here.

I think that if those who are opposed to these kinds of relationships see concern, then that -- then that's in the eye of the beholder. But the fact is the relationships, for the most part, long predate the current government in Iran. They, in fact, predate the current regime in Iran. And so I think as much as anything, this is a trip about reassurance and looking for opportunities to strengthen already important bilateral relationships and look potentially for new multilateral opportunities to work together.

. . .

QUESTION: On Iran and arms deals, if Iran is currently sandwiched between two substantial American military (inaudible) in Afghanistan and Iraq and that does not contain their regional ambitions, certainly not their nuclear ambitions, why will substantial arms deals to warn Iran's neighbors accomplish that? How much more will accomplish it and what can you say about the arms race that (inaudible)?

SECRETARY RICE: Well, let me reiterate what Secretary Gates said. First of all, long before this Iranian regime, we have had historic interests in this region and we have pursued them through security cooperation for decades now. And let me remind that the Egyptian and Israeli deals are coming to the end of a ten-year cycle, and so we wanted to begin a new ten-year cycle with them. We're working with Gulf states, not just Saudi Arabia but other Gulf states as well about what security needs they have.

Now our commitment to this region has been a commitment to be able to be a reliable partner for this -- the states of this region in meeting their security needs, precisely with in mind -- keeping in mind concerns about various regional military balances and the relationship between various militaries. And we can continue to do that. It is a good thing that the United States, then, can be a reliable partner in making certain that these balances are maintained.

As to the Iranians, the Iranians are pursuing policies that are indeed destabilizing to the region, harmful to our interests and harmful to the kind of Middle East that we want to see, which is a Middle East that would be moving toward greater freedom, toward, therefore, true stability of the kind that I think the Middle East has not seen.

We're confronting that in a number of ways. One is to make sure that when we see Iranian activities in Iraq, we confront them when those activities are harmful to our interests and to our people. We are reasserting, of course, our firm commitment to this region. But it's not against anyone; it's for stability in the region.

And finally, we are, with the coalition of states both inside the Security Council and in a growing force of private entities that are no longer willing to deal with Iran financially, we are putting pressure on their financial system and on their ability to get the kind of investment and credits that they need. People are simply reading the reputational and investment risk of being involved with a country that is in the Chapter 7 category. Being in Chapter 7 is not exactly the Good Housekeeping seal of approval. And I think it was just today that a couple of -- two big banks again announced that they're simply not going to deal with Iran. That brings pressure on the Iranian Government. So we have a multitude of ways of doing this.

Now at the same time, we want to be very clear to the Iranian people that we don't have any disagreement with the Iranian people. They deserve to live in a better society than they do, one that's freer, and they certainly deserve to live in a society that can answer their aspirations. But as long as Iran's activities are as destabilizing as they are, we have to bring pressure on that regime to change its policies.

Thank you. Thanks very much.