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A Conversation with Dmitry Medvedev

Speaker: Dmitry Medvedev, President, Russian Federation
Presider: Madeleine K. Albright, Former Secretary of State
November 15, 2008
Council on Foreign Relations

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RICHARD HAASS: I would like to thank Alfa-Bank for generously sponsoring today's meeting. And let me also mention one housekeeping item. Would you please turn off all your electrical items: your blackberries, your telephones, essentially anything but a pace maker, to avoid interference with the sound system. Let me also just say in case anyone did not notice the phalanx of journalists sitting around the room that today's meeting is on-the-record. Presiding over today's meeting is a woman who needs little introduction, Madeleine Albright. As you all know, Secretary Albright served under President Clinton as the 64th United States Secretary of State and is the first woman ever to be named to that distinguished post. And if recent stories are to be believed, she may have started a trend. She, uh... even at least as important, I'd like to think, two other things. She is by all accounts the original hockey mom and grandmom. She can explain that to you. And she's also a member of the Board of Directors of the Council on Foreign Relations and a good friend not just of mine but of this organization. So it's my pleasure and it's my honor to both welcome Madeline Albright, the former Secretary of State, as well as Dmitry Medvedev, the President of Russia.

[Applause.]

MADELEINE ALBRIGHT: Thank you very much and good afternoon. So let me explain that. My daughter was the varsity goalie of the Dartmouth ice hockey team and my granddaughter is the goalie of a boy's ice hockey team, so here I am. Thank you very much and good afternoon,. I'd like to join Richard in welcoming you on behalf of the Council on Foreign Relations to what is clearly a very timely conversation with President Dmitry Medvedev of Russia. President Medvedev is visiting the United States in connection with the G-20 economic summit, convened in response to the global financial crisis. And we're very grateful that he is able to take time from those meetings to be here with us. As most of you know, President Medvedev was elected president earlier this year and took office in May. He had served previously as first deputy prime minister and before that, as presidential chief of staff and chair of the board of directors of Gazprom. During his six months in office, President Medvedev has presided over a controversial intervention in Georgia and been required to cope, as have other leaders, with an array of economic anxieties. The president's recent speech to the Russian Parliament attracted a lot of attention, and he said many very interesting things and very strong expressions of support for democratic standards regarding freedom of expression and human rights. In months to come, observers in Europe and across the globe will be looking to see how well President Obama and President Medvedev are able to agree on policies that preserve the interests of each country without imposing on the rights of others and without stirring further speculation about how this relationship, this essential and important relationship will evolve. I think we all consider the relationship between Russia and the United States as a truly key relationship where friendship and understanding is absolutely essential, and where we are able to have the best communication. And having president Medvedev here today contributes to that greatly. So there's no better way to begin than for me to turn the microphone over to our very, very distinguished guest, and please help me in welcoming President Medvedev to the microphone.

[Applause.]

DMITRY MEDVEDEV: Dear ladies and gentlemen, I am extremely pleased to speak here at the Council on Foreign Relations. I'm grateful for the invitation to hold this meeting today. Quite naturally, I'd like at the outset to congratulate all present here, regardless of their political preferences, with the election of a new president of the United States. Russia views the choice of America as the choice in favor of change. We're welcoming the election of Mr. Obama. We believe that he will act to overcome problems which have accumulated recently in our relations. It's quite understandable that any change is a hard endeavor, especially in the period where the entire world is engulfed with a huge crisis, difficult to analyze. Any transformation in this period is extremely difficult and painful. But the times make change necessary. This is something we realize in our country, and I am sure that it was realization of the need for change that made the recent result possible. Of course elections are an internal affair of the United States, but the United States is a super-influential state, and therefore we have always analyzed what is happening in the United States and we realize the importance of domestic processes on world affairs. The world is going through hard times and it's evident that the world is not ready to counter the most complex challenges of the present time. In any case, the system of financial regulation turned out to be anachronistic and incapable of quickly responding to those problems which arose. Today in Washington we met in the format of G-20 - the twenty most influential economies of the world. I would say quite honestly that several months ago, I would have never believed that such a meeting could take place. But a crisis has its own drawbacks, and sometimes its positive points. And the positive point here is the opportunity to review at the top level the existing financial system and to create a new financial architecture. I'd like to say that I'm satisfied with the results we've achieved today in Washington. First of all, we have managed to adopt a declaration, which in my opinion, includes major principles and rules, in accordance with which the world can build its global financial relations and financial system in the years to come. I cannot promise to you that, say, a new Bretton Woods will take shape in Washington today. But in any case, we've made a step to set up such a system. And it's extremely important to tackle the existing problems in the U.S. economy, in the European Union, and in the Russian Federation. Russia is part of the global economic system and we were hit as well by the problems existing in other countries. And we pay, also, a high price for these problems. Therefore, we were extremely interested in the holding of this summit. And I again would like to reiterate: the results turned out to be positive. We made the first step - a very important step - to creating a new system. We agreed to meet again shortly: late March in one of the countries, most probably this will be Japan or the United Kingdom. We will meet again and we will take stock of what has happened over these months, and maybe to consider the documents which can be prepared. We've never met so often - I mean, major players and major economies - but the legitimacy of any international system depends on its reaction to world threats and challenges. And the system which is under discussion today should include early warning mechanisms. Hopefully, we will manage to set them up and put them in place. This is probably one of the most, the hottest, topics for those who participated today in the G-20 summit.

But there is another issue that is just as important, and that is the long-term question of Russian-American relations. A couple of words about our bilateral relations at the outset. They are extremely extensive, rich, and rather complex. I can admit that, recently, we have experienced the crisis of confidence. There is no confidence today in the financial world, and this is reflected in other areas as well. I think that there is no trust in Russia-U.S. relations, the trust we need. Therefore we have great aspirations to the new administration. The current administration has done a lot to create the basis for the modern Russia-U.S. relations. I'd like to mention the Sochi declaration which reflects all what has happened in Russia-US relations over eight years, but that is not enough. On many stances we can't find common ground. It's a deplorable fact, but that is life. And I think we can create a principally new framework, making possible to create a partnership between the U.S. and Russia. We do have many interests in common, after all. They include stabilising the global economy, nuclear disarmament and maintaining the arms control process. Therefore, it's so painfully perceived in Russia - I mean, unilateral projects which exist in the military area. We have always believed that any complex decisions, any hard decisions, should be based on a collective basis. And we have a lot of examples here, such as Afghanistan, the situation around Iranian nuclear problem, as well as the nuclear problem of North Korea, and the fight against terrorism. We've had a unique chance to create a principally new basis for our relations following 9/11. That does not mean that we've lost all chances, but many things which could have happened never happened. It's quite understandable that cooperation between our countries is much more important than getting some unilateral benefits. This is the way I see it, in any case. Therefore we can modify the strategic context of U.S.-Russia relations. There are issues which should be tackled as soon as possible. For instance, in summer 2007 we provided our own proposal on joint assessment of possible missile threats in Europe and how to counter these threats. We're open to this dialogue, and I'd like to reiterate once again that we will not be the first to act in response to the deployment of missile defense in Europe. We will do that as a kind of retaliation, and only in the case if this program will be continued in an unacceptable manner for us. It seems to be that it's better to have a global missile defense, including the Russian Federation, instead of having some fragments which gives more irritants. One of the ideas formulated by me was the idea to conclude the European security treaty, the so-called Pan-European treaty. I'd like to say that we consider it not as an alternative to the existing security systems in Europe. That's not the case. That's the way to gather our efforts with the understanding that Europe has big blocs like the European Union and NATO, the OCSE. Europe also has the Commonwealth of Independent States and the Collective Security Treaty Organization. All these organizations work in Europe, but it's the right time, I think, to get together our collective efforts, especially in the face of serious threats we are facing both economic, political, and military. I hope that all European states will participate in the work over this treaty, and the United States and Canada. In any case, I think this subject is extremely interesting. I'd like to stop here for a while. Hopefully, I can answer your questions. Thank you.

[Applause.]

ALBIRGHT: Mr. President, thank you so very much for giving us such a good outline of the various issues. I think that many, most everybody here in this audience and obviously all those who are listening are completely fascinated by how U.S.-Russia relations will proceed. I have spent my entire life studying U.S.-Russian relations, and there have been a number of different eras, and we always look to beginning something new, and with a new president in Russia and a new president here, it seems to me that there are many opportunities. But I also think that it's going to be very important to begin by understanding what each other's interests are. And you have given a number of different speeches recently, and I would be very interested in some definitions, if you don't mind. One of the areas that I think has been particularly interesting is when you talked about "privileged interests." What does that really mean, what are the ramifications of it, and what does it mean in terms of our bilateral relationship.

MEDVEDEV: I mentioned Russia's privileged interest at a point in the summer when I formulated the five current principles of Russia's foreign policy. One of them is the principle for developing relations with nations which traditionally have been connected with the Russian Federation. Or we can say that the Russian Federation has privileged interests there. This does not imply that this is an exclusive zone of our interests. This is not the case. But those are nations which are very important for us, with which we have lived side by side for decades or centuries, with which we are connected by the same roots. I am referring to the states that at one point were part of the Union of Soviet Socialist Republics. Before that they were part of other nations. Those are countries where Russian is spoken, where they have economic systems which are similar to ours, and where cultures are similar to ours. But those are not only nations that neighbor on the Russian Federation, there are other states that are traditional partners. This is what I imply when I speak about "privileged interests," or our "advantaged interests," with regard to those nations.

ALBRIGHT: May I follow up? What are they, when you say not just those on our borders, but partners. Who, what countries does that include?

MEDVEDEV: Well, those are nations that for decades or centuries have enjoyed ongoing contacts and exchanges with us that are important for us, both economic and political. This is a large part of European countries. And this could be the United States of America.

[Laughter.]

ALBRIGHT: That's where I was going. [Laughter.] And how about, I think this fits in with your concept and I've been just reading about what happened in Nice, in terms of this European security architecture. I was very interesting in your saying that it was not to supplant NATO, but how do you see it developing?

MEDVEDEV: I believe that it should be a rational, a functional architecture. What do I mean? Russia today is not a member of any political-military alliances. Well, we do have an alliance within the framework of the CSTO, but we do not consider this to be an alliance, this is a political bloc. However, it is in our best interests to have our voice heard in Europe, and since we do not participate in all the European institutions, for example, we are not party to the North Atlantic alliance, we are not party to the European Union. For this reason, we want to have a platform where we can discuss all sorts of issues. As I see it, the OSCE (Organization for Security and Cooperation in Europe) does not fit this purpose fully. Recently it has not been acting efficiently, and in the Russian Federation we have raised a few questions in regard to that organization. But this is not the main point. We want to have an organization that would bring together not only all European nations but also all major organizations that form Europe that also participate in addressing various issues: NATO, the EU, the CIS, the CSTO. And if we manage to build such a forum, it could play a positive role, but it should not replace existing institutions. I'm a realist and I fully understand that the existing institutions will remain. But this will create an opportunity for Russia and certain other countries that do not participate in those organizations to express their positions in a frank manner. It will allow them to meet and address all sorts of issues, including those that relate to existing threats. If we had an organization similar to the one I'm speaking about, then probably we could have avoided the difficulties that arose in August. I mean, the crisis around Georgia's intrusion into South Ossetia.

ALBRIGHT: Can I ask you, and I don't mean to be defensive about this, but when we were in office was when there was NATO expansion. And I had a conversation with your predecessor, President (Boris) Yeltsin, and he said, 'Why are you expanding NATO? We are a new Russia.' And I said, 'Yes indeed, you are a new Russia. But it's also a new NATO. It's not against you.' The question is, what relationship do you see yourself having with NATO, and what could be done in order to fulfill some of the ideas that we had in terms of a closer and better relationship between Russia and NATO with the possibilities we thought they'd, that could come out of it?

MEDVEDEV: Of course, we are not happy about NATO expanding its geographic area closer to the borders of the Russian Federation, because we are not party to this political-military alliance. This does not add confidence either to Russia, or Russian leaders, or Russian citizens. But this does not imply that there cannot be full-fledged, open partnership between the Russian federation and NATO. And I believe that the NATO-Russia Council which has been created had the necessary capability to succeed. It was not our initiative to impose limitations on the work of the NATO-Russia council. We are ready for any evolution and we are ready for the downsizing of relations between Russia and NATO. But this will not make anybody's life happier. In addition, we have lost some of the opportunities we used to enjoy. Therefore, Russia is ready to build normal, friendly relations with NATO, taking into account, naturally, the interests of the Russian Federation.

ALBRIGHT: I might ask you questions, some other questions, in terms of some of your speeches. What did you mean by some of the reform measures that you proposed and how do the economic reform measures coincide with whatever happened at the G-20 and in terms of how the current crisis has affected the Russian people. So how do all those domestic issues fit together?

MEDVEDEV: The crises are not something that people like, and they normally arise in spite of the wishes of leaders or citizens of this or that country. I believe that the current crisis is a serious one. We have encountered for the first time this kind of challenge. It is pointless to analyze now what has actually occurred, but it is obvious already that the world's leading economies have not coped with this crisis, primarily the economy of the United States, which is the strongest and the most influential economy which started dragging behind itself all the other economies. But, as I already mentioned, there is a certain advantage here, because this is another opportunity to readjust the system of economic relations. This is the challenge which we need to address. As far as the future financial architecture, I believe that today there is no arguing about its future setup. It has to be more open, it has to be less risky, it has to be agreed upon by all the participants in the financial system. This financial system be based on the equality of opportunities of all the participants. The system should be able to overcome all the risks, cyclical risks, involved in the market economies. The system should create modern, state-of-the-art corporate standards, corporate governance standards. It should be based on normal data provided by rating agencies, and the system should not allow for the emergence of speculative bubbles. All these principles are included in the declaration that we have agreed upon earlier today. I believe it is very important for these principles today to be shared by the nations whose political systems are very different from each other. This implies that there is a chance to overcome this crisis. First, after all, none of us have ever encountered such a crisis. This is a crisis of a new global economy, of a new global economic system. Second, to a certain degree, this distracts us from some other problems. In the current situation, the efforts of many nations are aimed at overcoming the crisis. Maybe this is not too bad. This creates opportunities to forget about certain differences, because when we have a common enemy, and this is obvious that this is the crisis, all other motives are forgotten. And I also see in this a good opportunity to regain ground in the Russian-American relationship.

ALBRIGHT: I found it very interesting that when you came into office, your very realistic assessment of the Russian economy and various issues. I wondered what you set for yourself in priority goals in internal restructuring, and what do you think is the most elusive of these goals?

MEDVEDEV: Of course, the Russian economy is still a far cry from perfection. We have achieved some success over the recent years, our economy has become more stable. We have accumulated huge gold and forex (foreign exchange) reserves. Until recently we had quite good macroeconomic indications, they will remain pretty good this year, but our economy is very far from perfection. We need structural reform. We are willing to create an innovative economy, not just an economy which would be based on exports of oil and gas. The intellectual capacity of the Russian nation is immense, and this advantage is not used. In addition, I believe that we have not yet created a system that would protect our economy. What do I mean? As a lawyer by education, I have to agree with those who believe that we have still not created an efficient system to protect ownership rights. And we have not created an efficient court system. We have only taken the first steps to restore judicial remedies. But I cannot say yet that our courts are working the way they should. Unfortunately, this is a consequence of a very low and imperfect legal culture, and the derision of law that has persisted in Russia for decades or even centuries. And this has implications for the system of the protection of ownership rights. I believe we have to focus our attention on this as well, since this legal framework is extremely important for the economy to develop. And I have the feeling that we will be able to resolve this problem. There is another problem which I speak a lot about these days. I don't only speak about this, I am trying to undertake real efforts. This is the problem of corruption. Unfortunately, it also creates huge problems for our economy. Business people have to pay bribes, bureaucrats accept bribes, and this has repercussions for the business climate. Unfortunately these problems are extremely urgent for Russia today. And we need to speak about this. And we should not only speak, we should also act. And recently we have been able to take a number of steps. Just a few weeks ago (we) introduced an anti-corruption package to the state Duma, the lower house of the Russian parliament. It took us five years to prepare that package, and it is only now that I was able to advance it. I totally realize that it is not enough to adopt a law to resolve a problem, but our legislature should be modern, it should address the challenges that exist in our society, and it should be aligned with international approaches in this field. Therefore I believe that it is very important and I do not want to deviate from this path.

ALBRIGHT: This is my last question, then I'll turn it over to the audience. I have worked for a number of presidents and I know that each one always wishes that his term was longer. So I wanted to ask you why you introduced that for the Russian presidency.

MEDVEDEV: This is normal for people in power to try to strengthen their capability. But I was guided by other motivations. The thing is, that our Constitution, on the whole, is quite a good one as I see it. It is modern, it contains a list of rights and freedoms that today are relevant. This is a Constitution for a presidential republic. And Russia can only exist as a strong presidential republic. Russia is too large, Russia is too complex, Russia consists of an immense number of constituent entities. It's a multi-religious country. And there is no other system, and a presidential republic is the only system which can govern Russia. This is probably the case with the United States of America. The U.S. can only be a presidential republic. But this does not imply that our constitution is ideal. And the meaning of this change is to achieve stability for a transition period. I believe that in the nearest few years, I do not know exactly, 30, 40 or 50 years, Russia needs a stable political system, which would include a stable and strong parliament and a strong president. And it would be desirable for these two branches of government to have terms of office that do not coincide. Therefore I suggested that the Duma should have five years and the president should have six years. The world is changing. We should recall the constitution that existed in France in the times of General (Charles) de Gaulle - it had a seven-year term of office for the president and it played a good role to make France a strong nation. But at some point the lawmakers decided that it was no longer relevant to have such a longer term of office. They reduced it by two years. Maybe in 30, 40 years the problems faced by our government will be resolved and we can go back to the previous term of office, but this will not be my problem. [Laughter.]

ALBRIGHT: Thank you so much. Let me turn to the audience. There are people with microphones, and if you would identify yourself please.

BARBARA SLAVIN, WASHINGTON TIMES: Madam Secretary, Mr. President, I'm Barbara Slavin, I'm assistant managing editor of the Washington Times. [In Russian:] Welcome in America. [English.] I wanted to just try to clarify a couple of things, if I may. Are you saying and did you tell President Sarkozy yesterday that Russia will not put missiles, rockets into Kaliningrad, that Russia wants to have discussions with the United States on this issue? And are you hopeful that president Obama might delay the deployment of missile defenses to Europe?

MEDVEDEV: To answer this question, well, I should come up here [to the podium]. President Sarkozy likes to speak from the podium. [Laughter.] We discussed that. I won't be too emotional as he is, but I'll try to explain to you and give you the answer to your question. We really do not want to deploy anything. We never thought about any counter measures. That was not our idea, our thought to place anything in Poland and the Czech Republic. Moreover, these decisions were taken in contrast to decisions taken in the European Union, as far as I understand, NATO was involved at the last minute. But that does not matter. The major thing, the stance of the Russian Federation, I can tell you honestly because I was in the president's administration and then in the government. Our position was to agree upon this with our American partners. We proposed many things. Let's create a global system. Let's involve Russian radar capabilities. Let's ask our Azeri counterparts to use Gabala [radar installation]. They said, OK, that's interesting, let us first do that and then do the rest of things. Then we got a question. Why should they do this, because all these strange measures just to put radars in Poland and the Czech republic? They are close only to the Russian Federation. But other states, like rogue states, are not covered by these capabilities. Then why should we have this? We were involved in a hard dialogue with our American partners, we persuaded them to find solutions. But at an appropriate moment we were told, 'We cannot guarantee that we'll let you into these facilities, because it's up for the Poles and the Czechs to decide.' And therefore, I was forced to formulate our answer. But we will not do anything until America makes the first step. If this step is so unfortunate as it is envisaged today, we will have to act. But to my mind, we have good opportunities to solve this problem, to agree either on a global system of protection against, for instance, rogue states, against those states who have caused some suspicions, or to find ways out in terms of programs existing already which will satisfy the Russian Federation. This is an open-ended question, I'm ready to discuss it. Hopefully, a new president and new administration will have a willingness to discuss this matter. At least the first signals we got demonstrate that our partners really think about this problem, and not just rubber-stamp this problem.

ALBRIGHT: I hope very much that you have, the way you stated it now is the way it is, cause I must say that some of us were a little surprised at your November 5speech, because it had some elements of some anti-Americanism and I think it's going to be very important to, in fact, nurture a strong U.S.-Russia relationship and I hope that is where we are now.

ARNAUD DE BORCHGRAVE, CENTER FOR STRATEGIC AND INTERNATIONAL STUDIES: Arnaud de Borchgrave, CSIS. Mr. President, could I take you to Iran from your previous answer, and could you explain to us what you think would be the most effective way of discouraging Iran from taking out the nuclear option?

MEDVEDEV: Thank you. I'd like to say a couple of words about anti-Americanism. In my state of the nation address, I mentioned that Russia has no anti-Americanism, but there are some difficulties in understanding each other. We would like to overcome this, exactly this, with the new administration. And now, about an efficient response to the existing Iranian program. I think that the only efficient way to respond is a peaceful way, because any other things can create huge problems for the Middle East and for the entire world. Iran is a hard partner and it's natural that a number of concerns we have are still there, but we are working in all different formats with our colleagues to look for ways to influence this situation. In my opinion, we haven't lost all chances. As far as I understand, about this stance of the new administration from the information I've got, the new US administration is not going to take any harsh decisions. In any case, they do not have any such plans for the near future. It's the right thing to do, because in my mind, harsh decisions are extremely dangerous. We can create a principally new situation, and we will have to sort things out for decades after that. We are discussing this matter on a regular basis with our colleagues. By the way, this dialogue is ongoing and it existed even in difficult times in our relations with the American administration. We are ready to take all steps as one of the participants in this process to remove the concerns which exist at the moment.

ALBRIGHT: All the way in the back.

RICHARD HEROLD, BRITISH PETROLEUM: Mr. President, welcome to Washington. I'm Rich Herold with BP. And thank you for your leadership of the energy industry in Russia. Given the financial crisis and the reduced capital available to the energy industry, and of course the results of lower oil prices, can you please give us an idea of your priorities for Russia's energy industry and your plans for attracting the investment to make those priorities possible.

MEDVEDEV: Thank you. The energy sector is extremely important for the development of Russia. We hope to develop other sectors of our economy as well without losing opportunities, but energy for many years to come will be a backbone of Russia's economic development. Priorities which we have formulated are crystal clear. We even worked out a special energy security concept which was proposed to our partners and the G8 summit in St. Petersburg. What's the essence of this strategy? It's the opportunity to create a new equal system of energy security where interests of all participants in the energy chain are well-balanced: countries and companies which produce oil and natural gas, as well as other energy products; transit countries; and consumer countries. This may be the most complex problem. But that's the essence of the strategy, because the existing regulation is not sufficient, in our opinion, and in some cases it's not beneficial to the Russian Federation. But this does not mean that we will not respect any of the rules we have committed ourselves to. This means that we need to think about the future. Moreover, we are ready to implement a joint project. We mentioned this many times that this should be done on the principles of mutual interests, especially in areas of interest for the Russian Federation. Russia has a good energy basis. We can pick up interesting projects and interesting ideas to develop them with many countries, including with the United States. To address a number of urgent issues facing the Russian economy, we will have to unpack new oil fields. This should also be done to fulfill our obligations, both to supply oil and natural gas to the West, and oil and gas to the East. This requires a great amount of investment in this area. We intend to make these investments on our own and with the participation of other players and other investments. The present day situation in the energy market is far from perfect. Prices are rather hard to fix, and for Russia if means lost revenues. These prices reflect the state of the world economy and the state of the American economy. I'm convinced that if we can find answers to questions formulated today, if we can tackle today's issues, prices will change. But I'd like you to understand that we're not advocates of extremely high or extremely low prices. We need predictable prices which will pave the way for the development of our economy. And this is part and parcel of our energy policy. We believe that energy is our common heritage and we are open to implement joint projects in this area.

ALTON FRYE, COUNCIL ON FOREIGN RELATIONS: Mr. President, you express flexibility about the future evolution of relations between Russia and NATO. One idea raised here is the future European security architecture might well be based on including Russia as a formal member of the alliance. How open would you be to a discussion that looks toward the possible membership of Russia in NATO.

MEDVEDEV: That's a good question. The thing is that the North Atlantic alliance had a chance to invite Russia at a certain period of its history. The alliance did not do that, and now the situation is a bit different. But quite naturally, we would like to develop full-fledged normal and friendly relationship with NATO. We're ready to develop partnership with NATO. That's not a problem at all. Moreover, if our colleagues and partners see additional opportunities to develop those relations we are ready to consider them. Russia is not closed to discuss any form of cooperation with NATO, if it meets the interest of peace in the world. I do not know how it easy now to analyze the possibility of Russia's accession to NATO. The situation does not speak in favor of that. But there's a good phrase: never say never.

JIM HOAGLAND, WASHINGTON POST: Mr. President welcome back to Washington. I want to ask you to clarify something you said earlier in your remarks, and that is that if the European security organization that you have in mind had been in existence in August we could have perhaps avoided the conflict in Georgia. Could you tell us how that would have worked, because you had bilateral contacts with Georgia up until the early summer, and that did no t seem to be able to resolve it. How could another outside organization have worked that, and can you help us understand how we go forward now on the question of Georgia. Do you see possibilities other than the West having to accept the independence of (South) Ossetia and Abkhazia as fait accompli, and what would you recommend to the United States, what red lines might you have in terms of U.S. help to the Georgia to reestablish their defense forces?

MEDVEDEV: I think that if we had had an additional treaty body, a European treaty body, at least we would have another forum to discuss the situation in Georgia and South Ossetia. Several times following my election I met Mr. Saakashvili, and the first thing I told him was that the Russia Federation recognized the sovereignty of Georgia over its territory. But we realize the problems linked to a de-facto split of the state, and we were ready to contribute to peace and security. We were ready to engage in a very complex dialogue between different entities, separate entities, formed on the territory of Georgia. And that was the case prior to effectual aggression of Georgia against South Ossetia. We never closed this channel. On the contrary, we agreed to meet in summer in Sochi or some other city, but at a certain point I felt, I started to feel that the Georgian leaders stopped taking interest in this. And at that point I had the feeling that they had worked out a forceful adventure. The adventurism was fully displayed, and a totally irresponsible and criminal decision was taken, which resulted in an armed conflict. After that, Russia had no other course rather than to recognize these two republics as entities of international law, just to protect nations living on these territories, and to prevent the humanitarian crisis, when they could be wiped out of the map. If at that point, at that juncture, a pan-European organization had existed, again I'd like to reiterate, we could have discussed such issues there, but such organization was not existent. Our bilateral contacts were not productive because the Tbilisi regime at a certain point made up its mind to use force. Of course history does not know if and should be, but if such a forum had existed it would have given us an additional chance. Now about what happened, actually. Of course we're a responsible state, and although it was a difficult decision, a difficult personal decision, for me personally as a man who was newly elected as president this decision to sue force, and the decision to recognize South Ossetia and Abkhazia, were difficult ones but they have a unilateral character. Such decisions cannot be changed, modified, or rescinded all together. We take seriously and responsibly our obligations within the international community. If we recognize a state, and if we thus create a new entity of the international law, then of course we will never reconsider such a decision. But that does not mean that we do not want to discuss the situation in the Caucasus. We are ready to do that. The plan which was formulated by me and President Sarkozy provides all the necessary opportunities within the framework of Geneva processes and some other channels. We are ready to build a new relationship with Georgia, but not with the present regime, because our position is that they committed a crime. That is the red line and we cannot step over this red line.

ALBRIGHT: Could I just follow up? Would you agree with a possible international investigation of this issue?

MEDVEDEV: From the very beginning, we said that the world needed to know the truth, because we believe the coverage of the events in South Ossetia, especially the coverage provided in the United States and in some other nations, was quite biased. And it is only now that the realization comes that this war was waged by Saakashvili, it was not an invention of the Russians. And from the very outset we were in favor of conducting an international investigation and this is my assumption now.

BERNARD KALB: Thank you, welcome Mr. President. We are now in mid-November, and I would like to move the calendar to the end of January, and you are meeting with President Obama. What specific or what urgent proposals would you set forth to the new president that would reduce this lack of trust you talked about between the two countries, and reassure the world that we are moving toward a new U.S.-Russian relationship? And what, in turn, would you expect from president Obama to achieve that same objective?


MEDVEDEV: I believe we have great opportunities to restore relations to the fullest extent, and we can build them on a new foundation. We can start from any point. There is an interesting question of missile defense in Europe. But this does not mean that we have to focus exclusively on this issue, we can start from something else. I believe the most important thing is for this meeting to take place to begin with. It should take place soon. And we have the same understanding with the president-elect, Mr. Obama. Without any delays, without any preconditions, I believe that the president-elect has that willingness and I share that willingness. We have a lot of interesting subjects to discuss. I have already listed them, I will not go back to this list. But most important is to begin with something. But there are certain things that people expect us to accomplish, and this is to ensure global security. No matter from what angle you look at it, the Russian Federation and the United States bear special responsibility for maintaining international security. And secondly, no doubt, global economic security. The United States is the world's largest economy, which is currently in a very difficult situation. The Russian economy is facing difficulties that are not as great, and the Russian economy is smaller, but it's also part of the global economy and it's affected by processes taking place in the global economy. This is an issue that we need not only to discuss, we need to make decisions on a collective basis. The next summit of the G20, we will see President Obama, and this is an issue that he will have to address on the first day in the White House and I wish him great success on this front.

MAURICE TEMPELSMAN: Mr. President, Maurice Tempelsman. Can I take you to another important neighbor of yours, a neighbor that's growing in importance both economically and militarily, namely China? Can you share with us your views, seen through the Russian national interest point of view, your relationship with China and your concerns about China?

MEDVEDEV: I do not have any concerns about China. Right after this wonderful meeting with you, I'll have a meeting with president Hu Jintao. We have an excellent relationship which is referred to normally as a strategic partnership. We have common ground on a whole number of issues: economic development, political issues. This does not imply that we have the same political systems or we share the same views in everything; but, nevertheless, this is a very good, full-fledged, friendly exchange. This is broad-scale cooperation on all fronts. This year we will have the volume of bilateral trade of 50 billion US dollars. And of course I want to have the same kind of relationship with the United States.

ALBRIGHT: OK, we'll take the last question.

CHARLES GATI: Charles Gati, Johns Hopkins University. I'd like to follow up on Secretary Albright's question with respect to the timing of your November 5 speech. That was a day when much of the world celebrated Mr. Obama's election, and that very day you delivered your speech. Was that coincidental? [Laughter.]

MEDVEDEV: Do you think this is blackmail? This is not just a coincidence, I can disclose to you the inside workings of this. Two times I postponed my state-of-the-nation address because I was not happy with the documents that had been prepared for me, and at some time I simply had to sit down at the table and edit the text of that state-of-the-nation address. And the date I chose was November 5. With all my respect to the United States, I absolutely forgot about the important political event that had to take place that day. There is nothing personal here. On the contrary, that address, in my address I said that I hoped all the difficulties and had arisen recently in our exchanges with the incumbent administration of the United States would be overcome, and of course about changes with the new administration. And I said on purpose that Russia does not harbor any anti-Americanism, but problems have piled up, and we have every chance to resolve those problems. And in any case, I have moderate optimism in this regard, and today's meeting is only strengthening that optimism.

ALBRIGHT: Mr. President, I would like to thank you for this very important meeting and let me say this: we are about to inaugurate the 44 th president of the United States, and have turned power over peacefully that many more times, and we can consider ourselves very proud of being able to do that - the oldest democracy in the world. I would also like to say that there is a huge opportunity. I don't think Russia and the United States have ever had such two young and impressive presidents, who will be able to communicate in a new generational way, and I as the old lady here would like to wish you all the best of luck.

[Applause.]

MEDVEDEV: Thank you.

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