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President of Armenia Serzh Sargsyan: Dear ladies and gentlemen! Let me once again extend a warm welcome to our Russian friends in Yerevan.

I am very glad to meet with Russian President Dmitry Medvedev again. I think Dmitry Anatolyevich will agree with me that our meeting has once again confirmed that Armenian-Russian relations have all the dynamism of a strategic partnership and its cooperative synergies. Their solid foundation is our Treaty of Friendship, Cooperation and Mutual Assistance and its regulatory framework, which we are constantly striving to improve.

It is important that an active political dialogue between our two countries is developing today. We have reaffirmed our readiness to continue efforts to coordinate foreign policy. Today we signed a plan for consultations between the ministries of foreign affairs for 2009–2010.

During the meeting we expressed our readiness to further promote the efficiency of our trade and economic cooperation. We discussed in detail the outcome of the tenth anniversary meeting of the Intergovernmental Commission that ended yesterday. It focussed on the progress of the programme of economic cooperation through to 2010. I want to emphasise that most of the agreements we reached earlier have now been put into practice. Among them is the issue of energy supplies to Armenia, which will enable us to ensure that the stable growth of our economy continues. Our countries are equally interested in the development of ties between economic actors and regions, as evidenced by the newly signed agreement.

During the meeting we also discussed key issues in international politics, including guaranteeing global and regional stability and the prospects for working together to face up to new challenges and threats. We attach great importance to our countries' interaction within the framework of the Collective Security Treaty Organisation, the Commonwealth of Independent States and other international structures.

It is in our mutual interest to more effectively harness the potential of these institutions and to develop new forms of cooperation. We intend to continue to work together to strengthen security, stability and cooperation in the South Caucasus.

We welcome Russia’s mediation mission in the OSCE Minsk Group, which along with the group's other co-chairmen, France and the United States of America, is promoting the peaceful settlement of the Karabakh conflict. Armenia has reiterated its willingness to seek solutions on the basis of the Madrid principles.

As always our talks with the President of Russia were held in a spirit of friendship and understanding and proved to be very substantive, touching on virtually every aspect of our relationship.

Thank you for your attention.

President of Russia Dmitry Medvedev: Ladies and gentlemen! It has been a long time since I was at a press conference in such fantastic conditions – under the open sky on a soft, warm autumn day. So we already have to thank our Armenian friends for this. And of course I want to thank them for the warm welcome we have enjoyed in Yerevan.

I am fully satisfied with the outcome of today's talks. They have continued the honoured tradition of intensive summit exchanges and, most importantly, confirmed the closeness of our relations, as Serzh Azatovich has said.

Of course the focus was on bilateral issues and the development of trade and economic cooperation. Russia is far and away the leader among Armenia's economic partners. Trade has increased during the last eight months. We hope that the rest of the year will be as good. Priority areas include the fuel and energy sector, industry, transport, banking and information technology.

We intend to continue to develop industrial cooperation, encourage mutual investment and expand a variety of interregional links. An agreement on this has just been signed.

I would like to note the productive work of the Intergovernmental Commission on Economic Cooperation, which held its tenth meeting yesterday in Yerevan. In this sense it was a full-fledged, hard-working affair and we can see the results in the negotiations that were held and the documents that were signed.

Cultural ties between our countries are also growing. We are part of the CIS Council for Humanitarian Cooperation and its Interstate Humanitarian Cooperation Fund, and here Armenia has been one of our closest and most active partners.

The Second Forum for Translators, Writers and Publishers of CIS and Baltic Countries was a noteworthy event held the other day in Yerevan. I am convinced that designating 2009 as the Year of Youth and 2010 as the Year of Science and Innovation in the Commonwealth of Independent States will enhance its ability to launch promising new projects and programmes.

We discussed issues on the international agenda. Of course among the issues we touched on were matters relating to the functioning of the CIS and the Collective Security Treaty Organisation. I would like to reiterate once again that we are ready to cooperate more closely with Armenia in the framework of the CSTO. Armenia has been the chairman of this organisation since September.

We talked about the situation in the Caucasus, following the aggression by Georgia in South Ossetia. Our countries have consistently advocated peace and stability in the region, and we certainly both believe that all issues should be resolved exclusively through peaceful means based on international law. The plan that has just been signed by our foreign ministers will give a new impetus to extending ties in the foreign policy area. We talked about the Nagorno-Karabakh settlement and discussed many important issues. Russia will continue to contribute to finding a mutually acceptable solution to this difficult problem.

In conclusion, once again I would like to thank Serzh Azatovich, all our Armenian friends, and all our colleagues for the constructive discussion of the issues on the agenda. I am confident that the talks will represent another important step in strengthening our alliance.

Question: Dear distinguished presidents! Russian-Armenian relations are rightly considered to be a revealing example of an alliance partnership. Yet others argue that Armenia is forced to accept Russia's 'friendship'. How do you feel about such claims and, in general, what is your assessment of overall Russian-Armenian relations?

Serzh Sargsyan: I can answer because I am familiar with much harsher views of certain so-called political analysts, with whom I categorically disagree. Force can never buy friends and even less maintain a friendship. They say here that you can't win love by force.

Our relations are characterised by openness, transparency, reliability, and we believe that the strength of our friendship lies in mutual trust. This confidence allows us to establish and develop contacts both with states in the region and those outside the region, because our strategic relationship with Russia never prevented us from engaging in cooperation and friendly relations with other nations. Therefore we believe that the current level of our relationship is very good, but we would like to see our relations as exemplary rather than revealing.

Dmitry Medvedev: You know, given the high level of cooperation and friendship that characterises relations between Russia and Armenia, if this is something coersed then it has been so for quite a number of centuries now. No wonder such relations are so valuable.

We are not just friends, neighbours and partners. Our relations have a very special chemistry that has evolved during a very difficult history, on both the Armenian and the Russian side. In light of this history, our current relations are superimposed on a solid legal foundation and on the way we feel about each other.

All of us present here have just attended the opening of Russia Square. I think that that is the best evidence that our relationship is based not only on pragmatic international or even domestic calculations but on a centuries-old friendship. And I think that this is the most precious thing in our relationship and that we must preserve it forever.

Question: For a long time now the word ”Karabakh“ has had ominous overtones. Heads of state, heads of government and ministers are repeatedly saying: we will help with resolving this … Could you please tell me a little bit – I realise you can't reveal everything – about the current stage of the attempt to resolve this very difficult issue.

Serge Sargsyan: If one is to characterise this word, I think you should characterise it as the tender word ”Karabakh“. I know that there is a problem and that we have to resolve this problem. Of course during our talks today we also discussed Karabakh. I wish to state that Armenia is ready to continue negotiations on the basis of the Madrid principles. What this means I think every one of you knows, since the document is available online and is on record. There is nothing secret about it.

This framework allows for the recognition of the right of self-determination, self-determination for the peoples of Nagorno-Karabakh and several other points of principle for us. The most important thing is that we really believe that the issue can be resolved through compromise and negotiation.

Dmitry Medvedev: I agree completely with what Serzh Azatovich has just said. The events in August made clear that any complex issue must be resolved on the basis of international principles and on the basis of negotiations. There is no other way to get a positive result in such cases. This is one of the main lessons of the crisis in the Caucasus, which happened in August this year.

With regard to reaching some kind of settlement or determining the level achieved in arrangements so far – that is a difficult thing. I hope we are moving forward; in any case, both sides are willing to seek a solution. Serzh Azatovich and I have just discussed this in some detail. I will not comment on the specifics because they are at the heart of the negotiations and that is what makes them so important. But I hope that very soon there will be a meeting between the three presidents in order to continue discussion on this topic. I hope that this meeting will be held in Russia. That is all I can say at the moment.

Question: Mr President of Armenia, for many years during the meetings of the leaders of Armenia and Russia, we have heard that economic ties between Armenia and Russia take second place to political relations. Following the tenth session of the Intergovernmental Commission on Economic Cooperation, it was noted that this year's trade may reach a billion dollars. How would you assess Armenian-Russian relations today?

Serzh Sargsyan: Today the time has come when we can talk about ambitious joint projects, large-scale projects. Dmitry Anatolyevich Medvedev and I discussed these today. We talked about building new nuclear power plant, the construction of a railway and other programmes. Our present economic relations are impressive, but they do tend to take second place to political relations…

Dmitry Medvedev: And our challenge is to overcome this tendency.

It is obvious that nobody is happy about the current financial and economic crisis, which is now in its active phase: the financial losses, loss of growth, investment losses — these often involve the loss of standards to which we aspire. The challenge of any government is to try to overcome these unpleasant conditions at a minimal cost.

We now live in a globalised world and we know that, say, 15 years ago Russia would not have been affected by this kind of crisis. Now the situation is very different, and with an open economy we have to respond to all the challenges that other countries are facing. This is the advantage of an open economy but also one of its flaws. This economy is developing according to its own laws, cyclical laws, and in the final analysis we must also take these things into account.

It is clear that we are paying for the gross errors committed by several states, first and foremost of course the United States, given that the share of the U.S. financial market and its impact on the global economy is very high. But this is one of the realities that we face, and we must make decisions based on the situation that currently exists.

I think that the decisions that we have now taken are sufficient. But that does not mean that those decisions have been made once and for all—nothing of the sort. Unfortunately life requires us to make adjustments, very often quite difficult adjustments, and we are going to respond, if need be, with new organisational, financial and structural solutions. Let me say again: our challenge now is to minimise the consequences of the global financial and economic crisis.

As for the Council on the Financial Markets, in fact the document was prepared before the active phase of these problems. Nevertheless, the Council should address several matters related to macro-economic regulatory questions, by monitoring the situation on the stock market, and invoking the necessary rules and regulations to allow this situation to improve or completely resume its normal functioning. But the Council is capable of dealing with these issues.

And I hope that at a time when we are faced with several challenges, including the stock market which has been falling steadily (and hopefully that will soon stop under the influence of several factors), this body will be able to exert a beneficial impact on these crises. But in general its task is to implement macroeconomic management of economic, financial processes and, above all, the stock market. I hope that our colleagues will be able to cope with this.