Former Secretary of State James Baker says Iraq will be the top international priority for President Bush in his second term, and that success depends in large part on the elections scheduled for the end of this month. Speaking at Rice University in Houston, Mr. Baker, who served as Secretary of State under the president's father, said peace between Israel and Palestinians and the effort to stop nuclear proliferation are the other top challenges.

Although the situation remains dangerous and difficult, James Baker says there are also reasons to hope for success in Iraq.

"Reconstruction is going forward in much of the country," said Mr. Baker. "Iraqi security forces are being trained. Political parties are organizing. Progress is slower than many had hoped, but it is occurring."

Mr. Baker says the United States cannot retreat in Iraq and that even those who may have disagreed with the war to topple Iraqi leader Saddam Hussein should now support the goal of creating a stable, peaceful nation.

He says the upcoming elections will be a key event in that process.

"If they should produce a representative assembly acceptable to most Iraqis, some sort of consensual government, the elections should both undercut popular support for insurgents and increase the possibility of additional peacekeeping and other support from other members of the international community," he explained.

Mr. Baker says a stable Iraq will also depend on a renewal of the peace process between Israel and the Palestinians. He says the Bush administration needs to take decisive steps to restart negotiations, encouraging the newly elected Palestinian government to fully renounce terrorism, while at the same time insisting that Israel remove obstacles to the peace process.

"Israel should be prepared to resume substantive negotiations for peace without requiring that all terrorist activities cease in advance of any talks," he added. "To require the absence of any terrorist act in advance simply empowers the terrorists themselves to prevent the resumption of peace negotiations."

The former Secretary of State, who is also a close personal friend of the Bush family, says facing the threat of nuclear-weapons development in Iran and North Korea will be the other big challenge for the president in his next term. He cautions the president not to be drawn into lengthy talks that would allow these countries to continue building nuclear capabilities.

Mr. Baker says military options are not good in either case, but adds threat of force must be maintained. He says failure to stop these two countries from developing nuclear weapons could cause a worldwide arms race and increase the opportunities for terrorists to acquire such weapons.

Mr. Baker says the re-election of President Bush has also strengthened his hand internationally. He noted that the effort he spearheaded at the president's request to reduce Iraq's debt was boosted by the election results.

"Until his re-election victory, some major creditor countries were unwilling to agree to more than a 50 percent reduction," he said. "After the win, we were able to rather quickly conclude the agreement for an unprecedented 80 percent reduction."

Mr. Baker notes that not all creditor countries have agreed to that level of reduction, but he says the reductions already achieved should help Iraq's recovery.