President George W Bush has signed an $87.5 billion package for military operations against terror, including $20 billion to help build 'stable democratic societies' in Iraq and Afghanistan.

"Today the United States is making a critical financial commitment to this global strategy to defeat terror. We're supporting our servicemen and women in the field of battle. We're supporting reconstruction and the emergence of democratic institutions in a vital area of the world," Bush said on Thursday.

"We're waging this war in relentless pursuit of the Al Qaeda network. We're waging this war in Afghanistan against Taliban remnants and Al Qaeda killers. We're waging this war in Iraq against Saddam loyalists and foreign terrorists who seek the return of tyranny and terror," he said.