"The best solution is to organise free and fair elections inside Syria," Rouhani told the World Economic Forum in Davos. "No outside party or power should decide for the Syrian people and Syria as a country."
He said peace and security in the Middle East is dependant upon the region's engagement with the world.
Mr Rouhani says his government intends to increase trade with neighbouring countries to improve relations.
The first Iranian President to attend the forum in over a decade, Mr Rouhani has also stated that Iran's nuclear program is not intended to acquire weapons.
And despite Iran's absence from peace talks on Syria this week, Mr Rouhani has expressed his concern for the tragedy facing the civilians.
"Millions of inocent people have been killed, injured or made homeless and refugees. It is a miserable situation and very sad.
"Of course we also have to be sad and concerned with the presence of terrorists. And such terrorists pouring into Syria, they are ruthless, they are killers. Sometimes they kill innocent bystanders and in other instances fight among themselves. This is indeed sad."
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