LISBON, Portugal - Secretary of State Condoleezza Rice said Friday that her historic visit to former pariah state Libya proves that the United States never writes off another nation forever.

Rice is the highest-ranking American official to visit the North African country in more than a half-century. She will meet over dinner with mercurial leader Moammar Gadhafi, whom President Reagan once called a "mad dog" and other U.S. leaders have called a terrorist.

"There is a long way to go but I do believe that this demonstrates that the United States doesn't have permanent enemies," Rice said as she flew to the capital.

Rice was welcomed with a modest ceremony at the airport and was meeting with Libya's foreign minister before the highlight of the brief visit -- dinner with Gadhafi in a traditional, desert-style tent. Rice told reporters she looked forward to hearing his "world views."

Gadhafi has sought the visit to culminate five years of halting but steadily improving ties that began when Libya abandoned weapons of mass destruction and renounced terrorism in 2003.

Libya has since agreed to pay compensation to the families of victims of the 1998 Pan Am 103 bombing over Lockerbie, Scotland, and those of a 1986 attack on a disco in Berlin, which prompted President Reagan to order retaliatory airstrikes on Libyan targets.

"It demonstrates that when countries are prepared to make strategic changes in direction the United States is prepared to respond," Rice said. "It's a beginning, it's an opening. It's not, I think, the end of the story."