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President Vladimir Putin: Good afternoon, ladies and gentlemen!

We are all satisfied with the results of this latest session of the Collective Security Treaty Organisation Council for Collective Security. As always, we had an open and business-like discussion of the most important issues concerning our multilateral cooperation, and we reached a whole series of practical agreements.

I would like to note that the Collective Security Treaty Organisation (CSTO) is consistently building up its international authority and influence. It has established itself at the highest level as an organisation that plays an independent stabilising role in the global, and above all regional, security system. This is confirmed by the CSTO being granted observer status in the UN General Assembly and by its recognition by the OSCE and the Shanghai Cooperation Organisation.

Taking into account developments in the world, we analysed the situation in the CSTO’s zone of responsibility and in the neighbouring regions, above all in the Central Asian countries and in Afghanistan.

As you know, the CSTO member states are helping Afghanistan in its post-conflict reconstruction. Today, we discussed how to make the assistance we provide to our southern neighbour more effective.

We are deeply concerned by the fact that terrorist training bases are still operating on Afghan territory, including with the direct involvement of certain special services. Furthermore, Afghanistan remains the source of a drugs threat and drugs trafficking that are constantly on the rise. We support the international community’s efforts directed at fighting terrorism in Afghanistan and we know about the latest events there and the measures taken to combat drugs trafficking and the drugs trade. But we are forced to recognise that this fight has been very ineffective so far.

In this context, we have drawn up priority measures to fight terrorist threats of direct concern to the CSTO member states. We have also agreed to establish a special body to combat drugs trafficking.

Our meeting today focused particularly on developing the CSTO’s military component.

We have approved a package of documents for military development within the CSTO through to 2010 and beyond. In particular, we plan to develop a combined air-defence system and also to improve the Rapid Deployment Collective Forces in the Central Asian region.

I am sure that the agreement on training for military personnel that was signed today will be decisively important in developing our cooperation. The decision to establish an inter-state commission on military-economic cooperation, meanwhile, will be an incentive for closer cooperation between our countries’ defence industries.

We have said on many occasions that fighting terrorism, drugs trafficking and other threats effectively depends directly on coordinated and effective international efforts. Today we examined in detail the CSTO’s practical cooperation with the United Nations, the Shanghai Cooperation Organisation, NATO and other organisations.

I think it is important that all my colleagues confirmed their commitment to actively continuing cooperation within the framework of our organisation.

In conclusion, I would like to thank my colleagues, the heads of states of the CSTO member countries, for their constructive and business-like approach to all the issues on our agenda.

I am sure that the Moscow session’s fruitful work and, above all, the agreements we have signed, will take us to a new quality of cooperation – cooperation in the interests of our peoples and in the interests of peace and stability in our countries, in the world in general and in the CSTO’s zone of responsibility.

Thank you for your attention.

Question: Another stage in the formation of the CSTO has been completed. What will be the next stage and what threats besides terrorism can the CSTO effectively deal with? My question is to the Presidents of Armenia and Russia. Thank you.

Robert Kocherian: Today we passed a document about the priorities of our activity for this year and next year. It proposes active work in fighting terrorism, drug trafficking, proliferation of nuclear weapons, and of course the military component remains the main element of our cooperation in fighting these threats. There was discussion of the creation of effective tools in opposing these threats. And I think that in future we should concentrate on tools – how and in what way we will effectively oppose these threats. A new element was our greater international involvement. And I think that this area can be developed. We declared ourselves to be a complete organisation. But the volume of work here, I believe, can be much wider. And today this was also the topic of discussion in a restricted and enlarged format. I am satisfied with today’s talk and must say that this line-up is one in which we do not have any particular disputes, but are focused on a practical result. And the organisation is developing dynamically and effectively. And most importantly, there are specifications on very many issues. I thnk the colleagues for the atmosphere that exists in the CSTO.

President Vladimir Putin: In principle I have already named the directions of our work which I believe to be of priority. I can repeat them once more. They are improving the forces of collective cooperation, the military forces of collective cooperation, and cooperation in the sphere of air defence and development of this system together. They are cooperation in the area of manufacturing special and military equipment and the cooperation of our economies in this area. They are staff training. I think that it would be very useful to examine the possibility of also using our forces for peace-keeping work. And finally, the CSTO, as we felt here today – I fully agree with my colleague, with the Armenian President – is a very good forum for developing joint political decisions and coordinating our foreign policy activity. Thank you.

Question: Aleksandr Grigor’evich [Lukashenko], how do you assess the role of the CSTO in the context of world challenges and threats? And can one call this organisation, the CSTO, which is now internationally recognised, a new centre of force?

Aleksandr Lukashenko: We all recognise the fact – and not just we, with the exception of a few nations the entire world recognises this, all nations – that the world cannot and must not be unipolar. Therefore, the system of international security should also not rely on one world centre, a centre of force. After the collapse of the Soviet Union this system of restraints and counterbalances was practically destroyed. We can also see how the United Nations operates: it is not always effective, to put it mildly, as an instrument for ensuring international security. And today the issue is, from our view point: that the world will in the near future gain either a unipolar dictatorship of one power, one superpower, or a new sensible system, the balance of which will be provided by several international associations, organisations, centres of force, if you like, one of which, as you said, may be the Collective Security Treaty Organisation. And why not. Especially if it has also announced itself, as the Armenian President said, on the international stage. I think that this second path is an option for many countries to take part in regulating security problems, which is fairer. Secondly, it will make it possible to oppose new threats.

Incidentally, as you probably noticed, and this was particularly stressed in the report by Vladimir Vladimirovich, the CSTO has made important decisions on a whole range of problems of new threats, as was said here, of international terrorism, trans-national crime, drug trafficking and illegal migration. All these problems in the todays world cannot be solved without the CSTO, without the actions of our organisation.

And what is particularly important in this context: the CSTO is an organisation capable of real actions. Here the example of last year was given, when as a result of the international operation Canal-2004, over 5,000 kilograms of drugs were confiscated. Over five tons in one operation! Over 4,000 drug crimes have been uncovered, 12,500 crimes have been detected and around 500 weapons have been confiscated as a result of this operation. This would have been impossible, it would not have been in the power of any one nation, even such a large one as the Russian Federation. But together, the effect is astounding! Thus we have proved that we have an effective organisation, and that it is capable of becoming a centre of force which will support equilibrium and international security.

I already talked about this today, and the media reported this earlier – about joint Belarussian-Russian training exercises. They were even more intensive than the CSTO format allows, in the framework of the Union state. So I would note – and I think that many will agree with me – that the Collective Security Treaty Organisation is the most effective, for all its shortcomings, and active system of all the systems that we have in the post-Soviet area. I mean the CIS, the EurAsEC, and what we are currently doing in the Common economic space. This organisation, in which we are all interested and where we see our own interests – works most effectively in the area of military organisation, in training personnel, and foreign policy. And here we can properly discuss our internal policy problems. Thank you.

Question: I have a question for Nursultan Abishevich and Vladimir Vladimirovich. You are the initiators of the EurAsEC. How would you assess the current state and prospects of development of the EurAsEC in the context of the agreements that have just been reached?

Nursultan Nazarbaev: Yesterday we discussed the problems of the EurAsEC. To sum up briefly, the EurAsEC is currently the most advanced of all the integration organisations in the post-Soviet area. I can cite several figures; integration and trade between our countries has reached $28 million today. And it has been increasing at the rate of 40% since 2003. This is the first area.

The second area is agreeing on tariff matters. The commodity group comes to 53%. This year we may reach 60.3%, and Kazakhstan works with the Russian side on another 10%, that is there is the 73% coordination on tariff groups, customs and other tariffs, which brings our trade to a completely new level. Our trade with Russia is already growing yearly at 35–40%, and will reach around $9 billion this year. And this shows that in this organisation, like in no other, we are gradually creating these conditions.

Today we discussed the main issues – how to complete the creation of a free trade zone. It practically exists between Russia and Kazakhstan and Russia and Belarus. But we need to examine exemption of goods again – what good should be exempt– and at the same time move towards the creation of a customs union.

In general, the integration process is beginning all over the world… Unless you’re inventing the bicycle, first a free trade zone is created, then currency regulation, then a customs union, then an economic union of countries. So this is all clear-cut. And now we are working on bringing customs legislation closer together.

It is good that parallel to the creation of the Common economic space of four countries, work is underway on 29 draft laws which will be ready by 1 July. Another 13 are being developed. These 43 laws, if we pass them, and approve them in parliaments, will give the foundation of a customs union of our countries. And at the same time, the entry process into the WTO is underway in all our countries. And we agreed that one thing should not interfere with the other. These things must happen parallel to each other. We believe that above all the main task is for our countries to join the World Trade Organisation and to coordinate the positions on which we will join it.

Mr Putin: I can only agree with what Nursultan Abishevich said. Indeed, over the last four years trade turnover between our countries has grown by two and a half times. These are very good rates. I would also like to direct your attention to the fact that in my opinion, integration work and the results of economic activity between different nations are connected. Between Russia and Belarus, the level of coordination of tariffs is about 90–95%, and trade turnover between our countries has reached almost $17 billion. With Kazakhstan, unfortunately, we have not yet reached this level of integration on tariffs. We have about 53% of coordinated tariffs. And accordingly, the level of trade turnover is so far only about $9 billion. But we know what we need to do to increase this trade turnover by several times.

But with Ukraine our level of tariff coordination is even lower. And despite the fact that the capabilities of the Ukrainian and Russian economies are much greater than the Russian and Belarussian economies, nevertheless we have a lower trade turnover than we do with Belarus. Understanding these quite elementary things, yesterday we outlined additional steps to develop integration processes. I agreed that this movement (we discussed this topic in considerable detail yesterday) should not interfere with our integration into the world economy, for Russia, Kazakhstan and other member countries to join the World Trade Organisation. We will advance along this path, coordinating our actions, remembering that according to the rules of the WTO nothing stops us from integrating our efforts in future at regional level. This is the direction that we will work in.

As for the bank that you asked about, this was the initiative of the Kazakhstan President one and a half years ago. We accepted this initiative and over the course of about a year we developed this idea at high expert level. We came to the conclusion that we could create a very effective financial instrument in the post-Soviet area with a nominal capital of one and a half billion dollars, of which half a billion will be invested by the Kazakh side, and a billion by Russia. Other countries can become involved in the work of this bank as shareholders, above all, of course, countries of the EurAsEC. I believe that this may be an additional excellent possibility for investment activity in the post-Soviet area, and above all within the EurAsEC. The main distinguishing feature of this bank should be its completely depoliticised nature. Not in words, but in deeds. It will work on market principles.

Question: I have a question for the Tajikistan President. Please tell me, what are the main directions at this stage of cooperation between CSTO member countries on the post-conflict process in Afghanistan? Thank you.

Emomali Rakhmonov: The CSTO is carrying out significant work in Afghanistan. This primarily concerns combating drug trafficking. And thanks to the efforts of CSTO member countries, an enormous amount of narcotics are confiscated every year by the CSTO. At the meetings today I informed my respected colleagues about the results of Tajikistan’s efforts over the last five years. Over the last five years, Tajikistan has confiscated over 45 tons of drugs. Of them, more than 23 tons were heroine. In other words, we saved over 22 million people from drug addiction. The second area of our work is in fighting terrorism. As you know, we are all members of the anti-terrorist operation in Afghanistan. And finally, as far as we are capable we take part in the economic recover of Afghanistan in various projects on a bilateral basis. Today we discussed and passed decisions on issues concerning coordination of cooperation between CSTO member countries in providing Afghanistan with aid and support.

Question: I have a question for the Presidents of Russia and Kazakhstan. At the moment, cooperation between CSTO and NATO member countries is developing at a varying level of intensity. How do you think relations between the CSTO members and NATO will develop in future? Thank you.

Mr Putin: We intend to build these relations both on a bilateral basis, i.e. between NATO and each individual CSTO country, and on a bloc basis. We made a proposal to NATO on behalf of the CSTO to establish appropriate contacts. Tomorrow the General Secretary of NATO will be visiting us here in Moscow. We will talk with him on this matter.

Mr Nazarbaev: I agree with what was said.

Question: I have a question for the President of the Republic of Kyrgyzstan. The problem of drug trafficking has gone beyond regional borders and affects the security of many countries. What is proposed to be done in the Republic of Kyrgyzstan to reduce the level of drug trafficking, within the framework of the CSTO?

Kurmanbek Bakiev: I agree that above all there should be coordinated effective actions of all our law-enforcement systems and forces. But when we stop drugs in our countries, we are primarily fighting the consequences. And it is no secret for anyone, we all know this, that the source is Afghanistan. This means that we need to direct universal efforts to destroy these drugs in Afghanistan itself. Then the results will probably be more visible.