Prior to the announcement, Bush called Saudi Arabia's King Abdullah to get his support, seen as vital to getting Arabs to buy into US peacemaking efforts.
Saudi Arabia does not have diplomatic relations with Israel and its participation could help Abbas compromise while also helping Olmert sell any deal to Israelis by holding out the prospect of a wider peace with the Arab world.
But Israelis and Palestinians have yet to produce even an agreement on roughly how such negotiations - the first in seven years - are likely to proceed following the conference.
Asked if the core issues of borders, Jerusalem's status and Palestinian refugees' right of return would be discussed at Annapolis, David Welch, the US assistant secretary of state, said he could not "foresee in that kind of detail what people will raise at the conference".
"The purpose of this conference is to give a launching pad to the bilateral negotiations," he added.
Ehud Olmert, the Israeli prime minister, told reporters in Egypt where he was meeting Hosni Mubarak, Egypt's president, that he wanted the Annapolis talks to "launch negotiations between Israel and the Palestinian Authority on fundamental questions to reach a two-state solution".
"The negotiations will concern the most fundamental questions. We will not evade any of them," he added.
"We hope that the negotiations in Annapolis will drive us to a just, equitable and balanced solution between us and the Palestinians, a solution of two states for two peoples."
Amr El-Kahky, Al Jazeera's correspondent in Cairo, said: "We expect every single country invited to attend. But every country wants something in return.
"For example, Syria wants to mention the right to regain Golan which was occupied by Israel in 1967. They want something in the final communique in Annapolis and most probably this will happen."
Jacky Rowland, Al Jazeera's correspondent in Jerusalem, said: "Israel is really sending out the big guns to the meeting, the prime minister, the foreign minister and the defence minister.
"Syria is only expected to send representation at ambassadorial level, either the Syrian ambassador to the US or UN.
"Israeli officials have been downplaying expectations for the conference... the Israelis see this as the beginning of a process and not the end."
Olmert also said after talks with Mubarak in Sharm el-Sheikh that he hoped to reach a peace deal with the Palestinians next year.
|Olmert told Mubarak a peace deal with |
Palestinians could be signed within a year [AFP]
"I hope to reach a definitive deal with the Palestinians in 2008," he told reporters at a joint press conference with Mubarak.
"The negotiations will not be simple. There will be differences, crises and arguments. But if we act with caution, there is a chance that we can reach a deal," he said.
But he warned that implementation of any future peace deal would have to wait until the Palestinian Authority retook control of the Gaza Strip from Hamas, whose fighters routed Fatah force loyal to Mahmoud Abbas, the Palestinian president, in June.
"There will be no implementation of the treaty before the road map commitments are all implemented," Olmert said.
"The commitments also apply to the Gaza Strip; Gaza must be part of the Palestinian state and then, naturally, the Palestinians must fight terrorism, and that includes the Gaza Strip."