 It's a very special pleasure to introduce Secretary John Kerry, Secretary of State of the United States. Welcome Mr. Secretary and actually I have to say welcome back because you joined us the first time 21 years ago and you have been part of many of our activities so it's really welcoming a good old friend. I have to say in all the discussions we had over the last days it was always emphasized how important American foreign policy is. Now we know it's in very good hands and so far we are eager to listen to you. Thank you Mr. Secretary. Well Klaus thank you very very much. It's an enormous pleasure for me to be back in Davos and to have this opportunity to be able to share some thoughts with all of you about American foreign policy and I have as Klaus just said to you all I have had the privilege of being here many times over the past 20 years I always appreciate the diversity of thought and the thirst for new ideas that really characterizes this forum. It's safe to say that Davos pushes the limits of thinking tries hard to find the new thinking and that's really what makes this forum so special so Klaus I congratulate you on many many years of putting together a really remarkable venue for everybody. Today I want to share our latest thinking with respect to the role that U.S. diplomacy can play in addressing some of the most pressing foreign policy challenges that we face in an obviously extraordinarily complex very different world from the world of the last century. I must say I am perplexed by claims that I occasionally hear that somehow America is disengaging from the world. This myth that we are pulling back or giving up or standing down. In fact I want to make it clear today that nothing could be further from the truth. This misperception and in some case driven narrative appears to be based on the simplistic assumption that our only tool of influence is our military and that if we don't have a huge troop presence somewhere or we aren't brandishing an immediate threat of force we are somehow absent from the arena. I think the only person more surprised than I am by the myth of this disengagement is the Air Force pilot who flies the Secretary of State's plane. Obviously our engagement isn't measured in frequent flyer miles. That would be pretty nice if I got a few as a matter of fact but it is really measured and I think serious students of foreign policy understand this. It is measured by the breadth of our global commitments their depth especially our commitments to our allies in every corner of the world. It is measured by the degree of difficulty of the crises and the conflicts that we choose to confront and it is measured ultimately by the results that we are able to achieve. Far from disengaging America is proud to be more engaged than ever and I believe is playing a critical role perhaps as critical as ever in pursuit of peace prosperity and stability in various parts of the world. Right here in Europe we are working with our partners to press the government of Ukraine to forego violence to address the concerns of peaceful protesters to foster dialogue promote the freedom of assembly and expression and I literally just received messages before walking in here of the efforts of our diplomats on the ground working with President Yanukovych to try to achieve calm and help move in this direction in the next days we will stand with the people of Ukraine. We're also making progress towards finalizing the transatlantic trade and investment partnership which would link the world's largest market the EU with the world's single largest economy the United States raising standards and creating jobs on both sides of the Atlantic in the Asia-Pacific region we are negotiating the Trans-Pacific partnership which will similarly encourage a race to the top not the bottom as it unifies 40% of the world's economy the United States is working extremely closely with China and our allies in the region in order to address North Korea's reckless nuclear program and also on diplomatic priorities like disaster relief and development I was recently in the Philippines and in a few weeks I will be back in Asia my fifth trip as Secretary of State within a year we are working with our ASEAN partners to discourage escalatory steps and conflict in the South China Sea and this is a critical part of the president's rebalance to Asia across Africa the home to seven of the world's 10 fastest growing economies we are investing heavily in both development trade and in the Great Lakes region we just recently helped end an armed rebellion demobilizing the M23 armed group and just yesterday thanks to our diplomatic intense engagement on the ground we have helped to achieve a ceasefire in South Sudan and I can tell you that almost every day during the so called Christmas break I was on the phone to either President Kier or to former Vice President Rick Machar or to the Prime Minister of Ethiopia or President Museveni of Uganda as we worked diligently to try to move towards peace closer to home we just completed a US Canada Mexico summit in Washington last week in preparation for our leaders who will focus on increased cooperation in our hemisphere the North American effort for renewed entrepreneurship renewable energy and educational exchanges so after a decade that was perhaps uniquely and in many people's view unfortunately excessively defined foremost by force and our use of force we are entering an era of American diplomatic engagement that is as broad and as deep as any at any time in our history and such are the responsibilities of a global power the most bewildering version of this disengagement myth is about a supposed retreat by the United States from the Middle East now my response to that suggestion is simple you cannot find another country not one country that is as proactively engaged that is partnering with so many Middle Eastern countries as constructively as we are on so many high stake fronts and I want to emphasize the last point partnering we have no pretense about solving these problems alone nor is anyone suggesting least of all me that the United States can solve every one of the region's problems or that every one of them can be a priority at the same time but as President Obama made clear last fall at the United Nations the United States of America will continue to invest significant effort in the Middle East because we have enduring interests in the region and we have enduring friendships with countries that rely on us for their security in a volatile neighborhood we will defend our partners and our allies as necessary and we will continue to ensure the flea flow of energy dismantled terrorist networks and we will not tolerate the proliferation of nuclear weapons now in reality all three of these challenges and the relationships that surround them and accomplishing all of these goals requires in President Obama's words for the United States to be engaged in the region for the long haul from security cooperation with our Gulf partners like Saudi Arabia and the United Arab Emirates with whom we are both discussing longer-term security framework for the region as well as to helping countries in transition like Tunisia Libya Egypt Yemen to countering al Qaeda and its affiliates to ensuring stability for the world's shipping lanes and energy supply there is no shortage of the places where we are engaged in the Middle East so the question isn't whether we're leaving the question is how we are leading today we believe that there are initiatives that taken together have the potential to reshape the Middle East and could even help create the foundations of a new order first the agreement that we reached with Iran as of this week Iran's nuclear weapons program is being rolled back in important ways on Monday Iran took a series of steps that the world has long demanded including reducing its stockpile of 20 percent in rich uranium disabling the infrastructure for its production and allowing unprecedented transparency and monitoring to guarantee Iran is complying with the agreement they will have to reduce their 20 to zero and they do not have and will not have the capacity for reconversion they have to reduce it to forms that are not suitable for making weapons Iran must also halt enrichment above five percent and it will not be permitted to grow the current stockpile of three point five percent enriched uranium Iran cannot increase the number of centrifuges that are in operation and it cannot install or use any next generation centrifuges to enrich uranium and while we negotiate a final agreement over these next months Iran will not be permitted to take any steps to commission the iraq plutonium reactor now clearly there are good reasons to ask tough questions of Iran going forward and believe me we will and good reasons to require that the promises Iran made are promises kept remember we certainly haven't forgotten there is a reason that the world has placed sanctions on Iran there's a reason why they exist in the first place and there's a reason why the core architecture of those sanctions remains in place and that is why this effort is grounded not in trusting not in words but in testing and that is why now inspectors can be at fordow every day that wasn't the case before the agreement we struck inspectors can now also be at Natanz every day that's also new thanks to the agreement we struck and inspectors will visit iraq plutonium plant every month and they are under an obligation to deliver the plans for that plant to us taken all together these elements will increase the amount of time that it would take for Iran to break out and build a bomb the breakout time as we call it and it will increase our ability to be able to detect it and to prevent it and all of this will to an absolute guarantee beyond any reasonable doubt make israel safer than it was the day before we entered this agreement make the region safer than it was the day before we entered this agreement and make the world safer than it was now yesterday president Rouhani stood here and he said that Iran is eager to engage with the world and hopefully but Iran knows what it must do to make that happen he told you that Iran has no intention of building a nuclear weapon well while the message is welcome my friends the words themselves are meaningless unless actions are taken to give them meaning starting now Iran has the opportunity to prove these words beyond all doubt to the world now let's be clear if you are serious about a peaceful program it is not hard to prove to the world that your program is peaceful for sure a country with a peaceful nuclear program does not need to build enrichment facilities in the cover of darkness in the depth of a mountain it doesn't need a heavy-water reactor designed to produce weapons-grade plutonium like the one at iraq it has no reason to fear intrusive monitoring and verification and it should have no problem resolving outstanding issues with the international atomic energy agency this is true for every country in the world with an exclusively peaceful nuclear program and it is the tough but reasonable standard to which Iran must also be held so we welcome this week's historic step but now the hard part begins six months of intensive negotiations with the goal of resolving all the international community's concerns about Iran's nuclear program i want to say that the p5 plus one has acted in unity in great cooperation and we welcome the international community's efforts that has characterized this initiative so Iran must meet this test if it does the middle east will be a safer place free from the fear of the nuclear arms race and diplomatic engagement my friends backed by sanctions and other options will have proved its worth the second challenge is syria where an enormous almost unimaginable human tragedy is unfolding before our eyes just this week we have seen the terrible new evidence of torture at the hands of the Assad regime but this week we also saw the syrian regime and the opposition sit at the same table in same room or separate tables but in the same room for the first time since the war began they were joined by more than 40 countries and institutions who have assented to the Geneva communique which clearly outlines how this conflict must conclude with the creation of a transitional government with full executive authority by mutual consent let me tell you in simple terms why that means Bashar al-Assad cannot be part of that future it is simple it is first because of the extraordinary havoc that he has wreaked on his own country on his own people a man who has killed university students and doctors with scud missiles a man who has gassed his own people in the dead of night families sleeping women children grandparents a man who has unleashed extraordinary force of artillery and barrel bombs against civilians against the laws of warfare Assad will never have or be able to earn back the legitimacy to bring that country back together that's number one but number two because of those things that he has done because of 130,000 people who have been killed the opposition will never stop fighting while he is there and so if your objective is to have peace this one man must step aside in favor of peace and of his nation you can never achieve stability until he is gone and finally any transitional government formed by mutual consent by definition will not include Assad because the opposition will never consent to permit him to be there the united states is engaged in this difficult endeavor because we know that the longer the fighting continues the greater the risk that serious sectarian divisions will spiral out of control we know there are people who wish that american young men and women were on the ground fighting for them there are people who would love to see america fight their war for them but that is not the choice the choice is first diplomacy in order to avoid the devastating results that could result in the disintegration of the syrian state and the instability that could spread across the entire region we are engaged because the number of refugees pouring into jordan i see our friend nasser jude of the foreign minister here into lebanon and turkey is destabilizing and it's unsustainable we are engaged because while we are proud to be the largest contributor to the humanitarian assistance to deal with those refugees the ultimate solution can only come when we stop the supply of refugees when we stop the fighting and that can't happen soon enough because Assad continues to kill and displace innocent syrians and in doing so has become the world's greatest single individual magnet for jihad and terror absent a political solution we know where this leads more refugees more terrorists more extremism more brutality from the regime more suffering from syrian people and we do not believe that we or anyone should tolerate one man's brutal effort to cling to power we must instead empower all of the syrian people that is why the united states and our partners who sat around the table this week will continue to fight for a pluralistic inclusive syria where all minorities are protected where all rights are protected and where syria can come together to be once again the secular and unified state that it was represented by a government of the people's choice where all minorities are protected now we believe this vision is achievable and we will continue to work closely with our partners for a new syria that can exist peacefully as a sovereign independent and democratic state where syrians will be able to have their voices heard without the fear of retribution imprisonment or even death now obviously we know this isn't going to be easy in fact it's obviously very very hard it's already hard but we've already seen in syria what forceful diplomacy is able to achieve as we speak a man who the day before he agreed to do it denied he even had the weapons is now removing all of the chemical weapons from that country as we speak the international community is on its way to completely removing all of syria's chemical weapons and unprecedented undertaking that is making the region and the world safer and is setting an example on a global basis we are convinced that if the syrian people are to have the chance to rebuild their country and if millions of syrian refugees are to have the chance to return home it is ultimately diplomacy that will make it possible there is no military solution to the problem of syria and that brings me to the most intractable of all conflicts the struggle to make peace between israelis and palestinians every time i meet my foreign counterparts anywhere in the world when they visit me in washington or when i travel to their countries i am not kidding you when i tell you that invariably the first issue that they ask me about is the challenge of middle east peace it may seem improbable to you but i'm telling you it's absolutely true from asia to latin america to africa all through europe this question lingers this intractable conflict has confounded administration after administration prime minister after prime minister leaders and peacemakers and they always ask me this about the middle east even before they complain about what we're doing or not doing ironically despite this global interest my friends people still asked me i'm astonished by it why with all the troubles in the world and in the middle east in particular why is the obama administration so focused on trying to forge israeli palestinian peace and obviously i've had that question directed me and personal and in other ways well the reason that we are so devoted to trying to find a solution is really very simple because the benefits of success and the dangers of failure are enormous for the united states for the world for the region and most importantly for the israeli and palestinian people after all the years expended on this the last thing we need is a failure that will make certain additional conflict there are some people who assert this may be the last shot i don't know the answer to that i don't want to find out the hard way but i want you to consider what happens if talks fail for israel the demographic the demographic dynamic will make it impossible to preserve its future as a democratic jewish state israel's current relative security and prosperity doesn't change the fact that the status quo cannot be sustained if israel's democratic future is in fact to be secured today's status quo my friends i promise you will not last forever president abbas is committed to negotiation and to nonviolence but failure will only embolden extremists and empower hardliners at the expense of the moderates who have been committed to a nonviolent track to try to find peace and what would happen in the west bank without that commitment to nonviolence the israeli and palestinian members of breaking the impasse initiative who are here today know well what is at stake israel's economic juggernaut is a wonder to behold prime minister netanyahu was able to talk to you about it here today but a deteriorating security environment and the growing isolation that could come with it could put that prosperity at risk meanwhile if this fails palestinians will be no closer to the sovereignty that they seek no closer to their ability to be the masters of their own fate no closer to their ability to grow their own economy no closer to resolving the refugee problem that has been allowed to fester for decades and if they fail to achieve statehood now there is no guarantee another opportunity will follow anytime soon this issue cannot be resolved at the united nations it can only be resolved between the parties if peace fails the region risks another destabilizing crisis one unilateral act from one side or the other will be yet another and yet another and another until we have fallen yet again into a dangerous downward spiral at a time where there's already too much danger in the region and you know what's interesting we often spend so much time talking about what both parties stand to lose without peace that we actually sometimes forget to talk enough about what they stand to gain from peace i believe that the fact that peace is possible especially in a region with so much tension and turmoil ought to motivate people palestinian stand to gain above all else an independent viable contiguous state their own place among the community of nations imagine this time next year here in davos if palestinian businessman and government leaders from the state of palestine are able to pitch the world's largest investors a host of projects from the palestinian economic initiative and imagine if they could be invited to participate in building a new state with new jobs new infrastructure and a new life free from occupation and for israel the benefits of peace are enormous as well perhaps even more significant for starters no nation on earth stands to gain so many new economic partners so quickly as israel does because 20 additional members nations of the arab league and 35 muslim countries stand ready under the arab peace initiative to all recognize israel and normalize relations the moment a peace agreement is reached as sheik abdallah ben zayed said at a meeting of the foreign ministers of the of the arab league which we held in paris a few months ago he said to his minister colleagues completely spontaneously unexpected for me he said you know what after peace israel will enjoy greater economic benefit from relations with the gulf than it now enjoys with europe that's the foreign minister of the united arab emirates just imagine what that would mean for commerce and trade stanley fischer the former governor of the bank of israel who president obama has nominated to serve on our own federal reserve board said that a peace agreement with the palestinians could boost israel's gdp by as much as six percent a year and together the jewish state of israel and the arab state of palestine could develop into an international hub for technology for trade tourism tourism unbelievable tourism the holy sites of the world of the major three religions this would invigorate a region it is long past time that the people of this great and ancient part of the world became known for what they can create not for the conflicts that they can perpetuate it is long past time that jerusalem the crucible of the world's three great monotheistic religions becomes known not as the object of constant struggle but as the golden city of peace and unity embodying the aspirations of israelis and palestinians alike the truth is that after decades of struggling with this conflict we all know what the end game looks like an independent state for palestinians wherever they may be security arrangements for israel that leave it more secure not less a full phased final withdrawal of the israeli army a just and agreed solution to the palestinian refugee problem and end to the conflict and all claims and mutual recognition of the nation state of the palestinian people and the nation state of the jewish people that is our destination and the real challenge is not what is it it's just how to get there how to get the leaders and the body politic of both places to make the courageous decisions necessary to embrace what would be fair and what would work that's why i am working with president abbas and with prime minister natin yahoo to achieve a framework for the negotiations that will define the end game and all the core issues and provide guidelines for the negotiators in their efforts to achieve a final status peace agreement i have watched over 30 years in the united states senate i was on the lawn in washington when the great handshake took place i've watched anapolis and why and madrid and oslo and all of these efforts but always we've left out the end game always people have had to wonder when or if the real peace could be achieved one of the biggest challenges in reaching this agreement i will tell you my friends is security the palestinians need to know that at the end of the day their territory is going to be free of israeli troops that occupation ends but the israelis rightfully will not withdraw unless they know that the west bank will not become in ugaza and nobody can blame any leader of israel for being concerned about that reality we have been working hard on addressing this challenge president obama's approach begins with america's steadfast commitment to israel's security he knows and i knows i know that there cannot be peace unless israel's security and its needs are met we have put the full range of resources of the u.s government behind this effort in an unprecedented way for the past nine months a team led by general john allen a four-star general in one of the most respected minds in the u.s military has been engaged in a comprehensive security dialogue with our israeli and palestinian counterparts based on his efforts we are confident that together with israel working with jordan working with the palestinians working with us all of us together can create a security structure that meets the highest standards anywhere in the world and by developing a layered defense that includes significantly strengthening the fences on both sides of the border by deploying state-of-the-art technology with a comprehensive program of rigorous testing we can make the border safe for any type of conventional or unconventional threat from individual terrorists or a conventional armed force we are well aware that technology alone is not the answer but we also know that it can play a key role in helping to secure the jordanian border just like iron dome has played a key role in securing israel's southern communities security is a priority because we understand that israel has to be strong to make peace but we also believe that peace will make israel stronger we are convinced that the greatest security of all will actually come from a two-state solution that brings israel the lasting peace and secure borders that they deserve and brings palestinians the freedom and the dignity that they deserve as committed as we are it is ultimately up to the israelis and the palestinians to reach an agreement on how to end this conflict make no mistake this will require difficult political decisions and painful compromises on both sides these are emotional issues many embedded in age-old narratives at the end of the day it is up to prime minister netanyahu and president abbas to recognize what the world has recognized that peace is in the best interests of their people but that makes it no less true that at every level everybody has a role to play the arab league and the european union have already shown how they can pave the way for peace and they have been unbelievably cooperative and we're grateful for their help i thank king abdallah of jordan and nasa juda and the extraordinary efforts of jordan to help move this the arab league nabil al arabi and uh halli datia the leader of the arab league follow-on committee that is working month to month to stay current and to be engaged in this many states have made contributions to the palestinian economy including a micro infrastructure initiative that is making a difference to people's everyday lives many companies including some of you here have invested in both israel and the palestinian territories and you've shown the difference that the private sector can make in this endeavor and all of you can make a positive contribution by dismissing please the all too easy skepticism by seeing the possibilities and by building the momentum for peace successful diplomacy like the conversations here at davos demands the kind of cooperation that has to come from many stakeholders as claus schwaab says in an interconnected world all challenges must be addressed on the basis of togetherness that is true whether you're talking about this peace effort or about what we must achieve in syria or about what we must ensure in iran intensive creative strong diplomacy requires cooperation and that is exactly why the united states is so engaged in the middle east and around the world and while we will stay so as our friends and partners take courageous steps forward they can be assured that president obama and his administration will remain engaged for the long haul but we will also confront these challenges with the urgency that they deserve we dare not and i assure you we will not miss this moment thank you