Speaking before a joint session of Congress, Bush promised to provide technical assistance, field expertise, and funding to the Philippine military.
"Today, President Arroyo and her government committed to a five-year plan to modernize and reform your military," he said.
Bush also vowed to help bring Abu Sayyaf terrorists "to justice" and to work with other Southeast Asian nations to dismantle al-Qaeda-linked Jemaah Islamiyah.
"My government and yours are pursuing a common objective: We will bring Abu Sayyaf to justice," he said. "And we will continue to work with our friends in Southeast Asia to dismantle the Jemaah Islamiyah terrorist network and other groups that traffic in violence and chaos."
Security concerns ran high during the visit of Bush, and he was late almost an hour in getting to the House of Representatives in Quezon City because "large crowds of people" blocked his route.
"There were large crowds of people on the motorcade route, and the (US) Secret Service wanted to make sure it was secure," said White House spokeswoman Claire Buchan.
"So they worked with Philippine authorities to make sure the area was secure."
Bush was the first American president to speak before a joint session of Congress since Dwight David Eisenhower in 1960.
Earlier at Malacañang, Mrs. Arroyo and Bush adopted the 2003 Joint Defense Assessment (JDA) on the fight against terrorism which was drawn up by Filipino and American military officials.
"In keeping with their May 19 Pledge to conduct comprehensive security assessment, the two presidents also reviewed and endorsed the findings of the 2003 Joint Defense Assessment of the Armed Forces of the Philippines’ capabilities and requirements," read the JDA.
The "May 19 Pledge" refers to the commitment of Bush to Mrs. Arroyo during her state visit to Washington early this year.
"The purpose of the JDA is to assist the government of the Philippines in developing a defense program that will improve the ability of the Philippine military to respond to threats to Philippine security," read the JDA.
"The two Presidents agreed that their respective defense establishments would embark on a multi-year plan to implement key recommendations of the Joint Defense Assessment. They agreed to direct their defense establishments to finalize details of the plan and begin its implementation."
Mrs. Arroyo thanked Bush for granting the Philippines the status of a "non-major NATO ally," and expressed hope that "this move would facilitate the modernization of the AFP" and strengthen the defense partnership between the two countries.
"President Arroyo noted the determination of her government to move forward on an ambitious program of military reform, including increased allocation of resources to Philippine national defense. President Bush committed to assist the Philippines in this effect," read the JDA.
"President Arroyo also welcomed the substantial new US programs of law enforcement training, equipment and expertise in support of her efforts to strengthen the rule of law and to reform and strengthen the Philippine National Police and other law enforcement agencies."
Bush "praised Mrs. Arroyo’s courage and strength" in confronting terrorism in the Philippines and Southeast Asia, where the Indonesia-based Jemaah Islamiyah is operating terrorist cells.
"He (Bush) expressed particular appreciation for Philippine initiatives to improve and expand international counter-terrorism cooperation and thanked President Macapagal-Arroyo for her leadership working with key ASEAN (Association of Southeast Asian Nations) partners to address the terrorist threat on a regional basis," read the JDA.
Mrs. Arroyo and Bush agreed that cooperation, particularly in information-sharing, is essential in the war against terrorism.
"The two Presidents focused their discussion on the security challenges facing the United States and the Philippines, agreeing that the US-Philippine partnership has taken on new vitality and importance in the contest of the global war on terrorism," read the JDA.
The two leaders also reviewed recent successes in the campaign against terrorism, "noting with satisfaction" that many terrorists have been brought to justice.
"They agreed that while progress had been made in attacking terrorist organizations both globally and regionally, much work remains to be done," read the JDA.
During her working visit to the US last Sept. 25, Mrs. Arroyo instructed Defense Secretary Eduardo Ermita to finalize the JDA in time for the eight-hour visit of Bush yesterday.
The JDA was adopted less than two weeks after the US government announced the designation of the Philippines as "major non-NATO (North Atlantic Treaty Organization) ally." — Marichu Villanueva, AFP