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NATO and the EU have also agreed on permanent arrangements on consultation and cooperation between themselves.
In sum, as we enter the 21st century, the Euro-Atlantic community - North America and Europe together - has to face some tough challenges when it comes to improving our capability.
If we get the capabilities, NATO, along with the European Union, can do amazing things.
I believe that the organisers of this conference have chosen a very timely subject for our discussion - because the 21st century will confront us with an entirely new set of challenges.
Globalisation will make our societies more creative and prosperous, but also more vulnerable.
For years, we have heard warnings that Europe needs to contribute more to NATO's capability.
For years, European leaders have pointed out that Europe is an economic giant, but a military pygmy.
But we acted pre-emptively in Kosovo in 1999 to stop Milosevic from doing what he was doing and increasingly doing the ethnic cleansing in a systematic way.
And, perhaps most importantly, regional conflicts will again and again confront us with a cruel choice between costly engagement and costly indifference.
And most countries are now reducing the number of conscripts and increasing the professionals that are available because they're available on short notice.
And I was asked if I would come and help with the recovery of this great British company, Cable and Wireless, and I'm delighted to become part of the new and very talented management that have been brought in to that company as well.
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