No one can doubt that it's been a tough couple of weeks in Iraq. In spite of repeated attempts by the United States to negotiate a truce with Iraqi insurrectionists, the violence has only intensified. April already has become the most deadly month for U.S. soldiers in Iraq.

  One may be tempted at times such as this to get discouraged and to think nothing good is likely to come out of Iraq. But I remain optimistic in the midst of growing despair by some of my friends because I am seeing firsthand how reform and liberalization are occurring in the Arab world, specifically in Jordan, Egypt, Kuwait and the United Arab Emirates. There is no reason that the same process cannot be applied to Iraq and Afghanistan in the fullness of time.

I recently returned from trips to Egypt, Jordan and the UAE, where reform is proceeding apace. Egypt is sending a delegation to the United States in June to discuss with Congress and the Bush administration bold reforms to which the Mubarak government has committed itself in creating private property rights, advancing market reforms and bringing the informal economy above ground, making it formal and vibrant. Peruvian economist Hernando de Soto and Empower America are working together to assist the Egyptian government as it embarks on this adventure in economic reform, and we hope that Egypt can serve as a platform and a model from which similar reforms can spread throughout the Arab and Muslim world.

 In Jordan, King Abdullah II is boldly and courageously pushing the envelope on reform. I have seen firsthand what he described in his prescient Wall Street Journal column recently, and I can attest that it is real. In his column, King Abdullah also offered some very profound insights that we in the West should take to heart, especially as they apply to Iraq during these trying times: "Most Arabs agree that reform is vital," King Abdullah wrote, but he also admonished well-wishers in the West that "effective reform must come from within Arab societies. Justified or not, many Arabs do not trust the motives of Western-inspired Arab reform. They look to Islam's own proud tradition of humanistic values, and they believe that Muslim nations are more than able to generate peaceful, democratic regimes."

I am convinced that King Abdullah's wisdom applies not only to democratic and economic reform in general but more specifically - and perhaps even more aptly - to putting down insurrection, dampening the flames of civil war and organizing a representative government in Iraq virtually from scratch. As the June 30 deadline for returning sovereignty to the Iraqi people approaches, I hope the administration will work closely with other Arab leaders such as King Abdullah and other young leaders in the region as they seek to nurture a new Iraqi government onto its feet.

Islamic civilization made great contributions to science, medicine, architecture and the arts in centuries past, and those contributions occurred when it showed the most tolerance toward religious minorities. It is, therefore, not surprising that Jordan and Egypt, two of the most tolerant Muslim nations, are leading the way toward Arab reform and revival in the 21st century under leaders like King Abdullah and the Mubarak government. Tolerance and liberty are the interlocking pillars of a free society.
Liberty means having the freedom to think and advocate anything you desire and to live your life any way you want, so long as doing so does not encroach on other people's freedom to do the same.

The 21st century can usher in an Islamic renaissance. By erasing the tolerance deficit and showing respect for other religions, Arab democracy and economic development can bloom, freedom can flourish and the full potential of the Arab people can be unleashed to close the development gap with the rest of the world. As Iraqis regain the reigns of sovereignty, they will look to Arab examples for how to build a free and prosperous society. They couldn't do better than heed the words of King Abdullah and apply the work of Hernando de Soto.