US President Mr George W. Bush said he believes Iraq can be disarmed peacefully and he is willing to give diplomacy one more try.
"We've tried diplomacy. We're trying it one more time. I believe the free world, if we make up our mind to, can disarm this man peacefully, but if not wehave the will and the desire as do other nations to disarm Saddam," Mr Bush told reporters.
"The stated policy of our government, the previous administration and this administration, is regime change, because we don't believe he is going to change," Bush said after talks with NATO Secretary General Mr George Robertson.
"However, if he were to meet all the conditions of the United Nations, the conditions that I've described very clearly in terms that everybody can understand, that in itself will signal the regime has changed".
Mr Bush's comments are the strongest indication yet the United States may accept Saddam's remaining in power if he met UN disarmament demands, despite standing U.S. policy in favour of a "regime change" in Iraq.
Mr Bush's comments came as diplomats at the United Nations conduct intensive talks over an elusive resolution on Iraq.
The United States, anxious to secure quick approval for any future action against Iraq, gave the other four key Security Council members a new draft of its resolution, but no decisions were made.