Bush, Schroeder united for a free Iraq

The two leaders pledged to push for a joint US-European partnership aimed at pushing for peace in the Middle East. They said specific proposals would be put before leaders attending a series of international summits in June.

Bush and Schroeder declared themselves "united in support of a free Iraq" and reaffirmed the July 1 deadline for a transfer of sovereignty from a US-run authority to a new Iraqi government.

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"We've had differences in the past. But there's nothing wrong with friends having differences and we are both committed to put the differences behind us and move forward," Bush told reporters as he and Schroeder sat side-by-side in the Oval Office.

Schroeder said he told Bush of German concerns about the weakness of the dollar versus the euro, which Germany feels is depressing German exports.

The official US position on the dollar -- which Schroeder said Bush repeated to him -- is that the administration backs a strong US currency. But a cheaper dollar has helped the United States cope with its current record trade imbalance because it makes US-produced exports cheaper in foreign markets.

Schroeder said Bush told him that while he is interested in a strong dollar, governments only have a limited ability to influence currencies.

"I conveyed that we are obviously concerned about the euro-dollar relationship," Schroeder said.