"Iraq's insurgents are now fighting a "free and constitutional government," according to President Bush, as he praised the swearing-in of the country's new Cabinet.

"The world saw the beginning of something new: constitutional democracy at the heart of the Middle East," Bush said. "Its formation marks a victory for the cause of freedom in the Middle East."

Speaking to the National Restaurant Association in Chicago on Monday, Bush said Iraq's new prime minister, president and parliament speaker are "strong leaders" representing the three major ethnic factions in the country. He said they would govern as Iraqis and the insurgents could not "divide Iraq along sectarian lines."

But Bush, calling the government "a work in progress," also said patience would be needed as the country unites.

"Iraqi leaders understand that as long as they remain united, there is no limit to the potential of their country," Bush said.

During the "three difficult years in Iraq ... the progress we've made has been hard fought, and it's been incremental," the president said. "There have been setbacks and missteps, like Abu Ghraib. They were felt immediately and have been difficult to overcome. Yet, we have now reached a turning point in the struggle between freedom and terror.