Exclusive: Condoleezza Rice Hopeful for Mideast Peace

Nov. 28, 2007— -- Wednesday morning President Bush hosted the Israeli and Palestinian delegations at the Mideast Peace Conference in Annapolis, Md. "Nightline" was granted extraordinary behind-the-scenes access to the conference.

In an interview with "Nightline" co-anchor Cynthia McFadden, Secretary of State Condoleezza Rice said "the stakes are high," noting that failed efforts at peace in the region in the past have often led to more violence.

"I clearly understand that failure is not an option here," Rice said. "And I think that the parties understand that. But inaction's also not an option. Doing nothing is also not an option. If you do nothing to try to resolve this conflict, [if] the parties don't try to resolve this conflict, you're going to have years and years more of the deprivation, the humiliation of the occupation, and of the terror associated with this for the Israelis. And that's not an option either."

"Both sides, I think, were thrilled about yesterday because it gave them a kind of international boost," Rice said, adding that President Bush was also "very pleased."

"Of course, he's been a big part of making this happen … and he was able to really kick this off in a good way. And everybody feels good about what happened at Annapolis, but everybody also knows that it's only a first step," she said.

Rice said the overarching goal is "to make certain that the establishment of a Palestinian state can really help the security environment for Palestinians, for Israelis, and for the region, because the creation of a Palestinian state is a new factor in the Middle East. It will need its own security forces, but it will also need security arrangements that will have to in part be negotiated."

"We often talk about security for the region, but we have to start first with security for the Palestinian people. And then, of course, Israelis, who will be withdrawing from the West Bank when this agreement is done have to be certain that they are not compromising their security."

Rice said the negotiations are in too early a stage to discuss the possibility of a military presence on the ground to maintain that security but added that "I don't really think that American boots on the ground are going to make sense in this conflict. … There may be a role that international experts can play in the way that they are right now at various crossings, helping with customs, helping with border control. There are going to be very many things that the international community can do, and of course, that's a part of providing for security."

Rice said that the Bush administration's position is that "ending the occupation that began in 1967 [will] require a negotiation on mutually agreed borders, and those mutually agreed borders, of course, will have a security component. States have to be secure. … But we want the parties to negotiate borders."

Rice called the question of the future of Jerusalem "the most difficult issue."

"This is going to be very hard for the parties," she said. "As you know, there's a lot at stake here. There is a lot that is not just territory in reality, but a lot that goes to the very core of these religions. But it's important that Jerusalem, of course, is a city where all are able to feel that they can get to their sites and the like. But this is one that the less said the better. Let's let the parties deal with these very difficult issues."