proliferation in this region and to reduce arms flows into an area that is already overmilitarised. That suggests that we and others inside and outside the region must consult on how best to address several dimensions of the problem:

         How can we cooperate to constrain Iraq's post-war ability to retain or rebuild its weapons of mass destruction and most destabilizing conventional weapons?

         How can we work with others to encourage steps towards broader regional restraint in the acquisition and use of both conventional armaments and weapons of mass destruction? What role might the kinds of confidence building measures that have lessened conflict in Europe play in the Gulf and the Middle East?

         Finally, what global actions would reinforce steps towards arms control in the Gulf and the Middle East? These could include rapid completion of pending international agreements like the Chemical Weapons Convention, as well as much tighter supply restraints on the flow of weapons and dual-use technology into the region. And what implications does that have for arms transfer and sales policies?

         A third challenge will be economic reconstruction and recovery. An economic catastrophe has befallen the Gulf and the nations trading with it. Kuwait has been looted and wrecked. Hundreds of thousands of workers have lost jobs and fled. Trade flows and markets have been disrupted.

         I am confident that the people of Kuwait will rebuild their country. As we have worked with the Kuwaitis in their moment of trial so we shall look forward to cooperating with them in their hour of recovery.

         And no one should forget that for the second time in a decade, the people of Iraq will be recovering from a disastrous conflict. The time of reconstruction and recovery should not be the occasion for vengeful actions against a nation forced to war by a dictator's ambition. The secure and prosperous future everyone hopes to see in the Gulf must include Iraq.

         Of necessity, most of the resources for reconstruction will be drawn from the Gulf. Yet, should we not be thinking also of more than reconstruction? It might be possible for a coalition of countries using both local and external resources to transform the outlook for the region - in expanding free trade and investment in assisting development, and in promoting growth-oriented economic policies which have taken root across the globe.

         Any economic effort must have a special place for water development. Well over half the people living in the Middle East draw water from rivers that cross international boundaries or depend on desalination plants. We have all been incensed by Saddam Hussein's deliberate poisoning of the Gulf waters, which could affect a large portion of Saudi Arabia's desalinized drinking water.

         Finally, we will want to consult with governments both from the Middle East and from other regions about specific arrangements that might best serve the purposes of region-wide economic cooperation. Such cooperation would surely be helpful in reinforcing our overall objective: reducing one by one the sources of conflict and removing one by one the barriers to security and prosperity throughout the area.

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