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Vladimir Putin: Good afternoon dear ladies and gentlemen!

I am glad to be able to welcome the Prime Minister of Portugal, Mr Socrates, to Moscow. Mr Prime Minister has already visited Russia: he took part in the events commemorating the 60th anniversary of the victory over fascism. However, this is the first official visit Mr Socrates has made to Russia.

I consider that our talks were very productive. Today we thoroughly reviewed the prospects for further developing our bilateral relations and noted the considerable progress in our trade and investment cooperation.

In 2006 our volume of trade grew by 13 percent. And in the first quarter of 2007 it has grown even faster. It is impressive. Our exports grew by 134 percent while imports from Portugal grew by 48 percent.

It is in our collective interest to consolidate this positive trend and to promote direct links between the two countries’ business communities, especially since our volume of trade is not very high in absolute terms.

In connection with this, I would mention that an exhibition of advanced technology from Portugal in the information technology and telecommunications sectors opened in Moscow at the beginning of 2007. In addition, a bilateral business forum was held under the auspices of Russia’s Chamber of Commerce and Industry. There are good prospects for diversifying our cooperation in the high-tech field.

Russian-Portuguese relations are distinguished by traditionally close and fruitful cooperation in the cultural and educational spheres. One major event in 2007 was opening an exhibition from the Hermitage’s collections in Lisbon. We intend to help further promote Russian language and culture in Portugal, including with the assistance of the Camoes Institute.

During the meeting we paid special attention to the forthcoming Portuguese EU presidency. We highly appreciate the attitude of the Portuguese leadership and the Portuguese Prime Minister with respect to strengthening strategic cooperation between Russia and the European Union.

We also exchanged opinions on an ideal system of international relations. I am pleased to see that our approaches are, in many respects, similar. These attitudes towards international affairs constitute a good basis for Russian-Portuguese cooperation within multilateral institutions and organisations.

I also drew Mr Prime Minister’s attention to Russia’s concerns with respect to several of our western colleagues’ undertakings and plans. I am referring to their reluctance to ratify the Adapted Conventional Armed Forces in Europe Treaty and on the United States’ intentions to deploy elements of a missile defence system in Eastern Europe.

Our position on this issue is well-known. We consider it both harmful and dangerous to turn Europe into a powder keg filled with new weapons. I repeat: this creates new, unnecessary risks for the entire system of international and European relations.

We will meet in Portugal in October for the next Russia-EU summit. I will be very glad to meet again with Mr Prime Minister, to continue our discussion, and to visit that hospitable country.

I hope that there we will be able to talk about our bilateral relations and to continue our dialogue on Russia-EU relations.

Thank you. Thank you for your attention.

Jose Socrates (simultaneous translation): Mr President, I would like to thank you on my own behalf and on behalf of the Portuguese delegation, for the hospitality with which you have received us. I would also like to thank you for the personal effort you have made to ensure that this visit has been a success and has achieved such positive results.

I am ending this visit with a sense of satisfaction, satisfaction above all at the fact that a big step has been taken to develop bilateral relations between Portugal and the Russian Federation. Our relations have received a great boost over these last two days. In recognition of this impulse, in recognition of the new quality in our relations, we have decided to establish a new institutional body and to give our bilateral relations a new strategic character.

Russia has already developed this kind of strategic dialogue with many other countries. The steps Russia and Portugal will now take to pursue this kind of dialogue in their relations will enable us to establish a forum bringing together representatives of civil society in both countries: politicians, noted economists and prominent scientific and cultural figures. This forum will provide the opportunity for both sides to meet regularly and will be an important source of support in our work to develop our bilateral relations.

I think that this kind of forum will prove to be the best way to develop our relations in culture, science and education. The forum we intend to establish will create opportunities in all areas – in the economy and in politics – to build closer bilateral relations for the benefit of both countries.

I would also like to note some of the results my visit has achieved in the economic and cultural spheres. Above all, I would like to note the understanding and important agreement reached by our respective finance ministers. What is important is not even so much that they have signed an agreement on settling the former Soviet Union’s debt to Portugal ahead of schedule, but that this step lays the foundation for fruitful financial and economic cooperation in the future.

Under the terms of the agreement reached, a Portuguese bank and one of the Russian banks have been instructed to open mutual lines of credit to support Russian exports to Portugal and Portuguese exports to Russia. I want to note in this respect that the Portuguese credit line will represent a sum total of around 200 million euros.

I will not tire you by listing all the contacts that have taken place over the course of this visit and all the results that have been achieved. I just want to say that the economic seminar that opened today has been a success and has accomplished much in terms of giving Russian and Portuguese businesspeople the chance to get to know each other better. I cannot but also mention the successful exhibition of Portuguese advanced technology, in which six Portuguese ‘pioneers’, six companies representing our high-technology sector, took part. The exhibition was a real success. Our companies’ representatives had meetings at the Russian Information Technology Ministry and with Russian companies working in the telecommunications and high-technology sectors.

I would also like to mention tourism, another very important economic sector. We have received great support and encouragement from Russian tourism companies in our efforts to carry out promotion campaigns here. I can add in this respect that we plan to simplify the procedures for obtaining visas as much as possible, which is very important for the tourism business.

I would also like to say a few words about our cultural relations. I want to stress the importance we place on the agreement we will sign on July 6 – the agreement on holding the first-ever exhibition of works from Russia’s famous State Hermitage Museum in Portugal. This exhibition will open during President of the Russian Federation Vladimir Putin’s visit to Portugal.

I would also like to note the work being done in Russia to translate the works of Portuguese authors into Russian. Representatives of our respective Ministries of Culture have reached an agreement in this respect.

Another important document that I must mention is the memorandum of understanding signed during my visit between our countries’ Justice Ministries. This document sets out the provisions for cooperation in the area of justice between our respective ministries, exchanges of experience regarding our respective penitentiary systems, training for specialists, and cooperation between our law enforcement agencies, especially in the fight against organised crime and international terrorism.

My visit was a bilateral visit between the Republic of Portugal and the Russian Federation, but we could not but take this opportunity to also discuss important aspects of relations between Russia and the European Union, given that Portugal will take over the EU presidency in little more than a month’s time.

I am not yet President of the European Union and cannot speak for all the EU member countries, but I can speak for Portugal and for its plans for the period during which it will head the EU.

I think that relations between the EU and Russia are an issue of strategic importance and major dimensions. This is a vital issue for Europe, for Russia, and for the entire world. But, like any strategic issue, this matter also needs to have its horizons – medium-term horizons and longer-term horizons. We cannot just think about what will happen next week, next month, or even over the next half year. This is an issue for both sides. Both Russia and the European Union are responsible for this work and we will bear this responsibility as we take steps to finally reach a joint agreement that will unite the history of Europe and Russia.

Anyone who comes to Russia cannot fail to be seized by the feeling of being face to face with history – the past history of this country, but also the ‘history of the future’, the history of the work to be done. Russia is one of the key players on the international stage and Russian history is interwoven with that of Europe.

I cannot but agree with President Putin’s words and I would like to quote the following phrase: “Russia has shared with Europe all its triumphs and all its tragedies”. I agree with Mr Putin when he said that Russia’s development has always peaked at the moments when it has been closest to Europe. The task and responsibility for both the European Union and Russia therefore is to reach a strategic agreement on our relations that would unite our historic missions. It is with this goal in mind and in this spirit that Portugal will begin its presidency of the European Union.

Question: My first question is for President Putin. After the summit in Samara, could Russia give the EU a sign that negotiations on drafting a strategic partnership and cooperation agreement between Russia and the EU can continue, and could this sign be, for example, a decision to lift the embargo on imports of Polish meat?

And a question for Mr Socrates: you spoke about the importance of the strategic partnership between the EU and Russia in the medium and long term. Does this mean that this partnership and cooperation should be based on European values? During your talks with Mr Putin, did you share with him the European Union’s concerns over the question of acceptance of common values and respect for human rights?

Vladimir Putin: Regarding signals from our side on a new partnership agreement with the European Union, we want to sign an agreement, but our position is that it should correspond to the interests of both sides, to the interests of the Russian Federation and of our European partners. The issue of imports of Polish meat is just one individual problem, one ‘tree’ that should not stop us from seeing all the ‘wood’ of our diverse relations with Europe.

This is actually a complex issue, and the problem is not just about imports of Polish meat but is about European Union agricultural subsidies and subsequent dumping of produce, above all from eastern European countries, on our market. This is in itself an issue we need to address, but if added to this we face the problem of produce from third countries also being dumped on our market, we can hardly be expected to be happy with the situation.

Poland, as far as I recall, was one of the biggest suppliers of livestock to our market, and we are ready to open our market to individual Polish companies that could deliver this product to our processing enterprises. We have already sent a letter on this question to Mr Kyprianou, the European Commissioner, and to our Polish colleagues. We think that this is a sufficiently clear signal of our willingness to cooperate and to hold negotiations on this problem. We do not think that these issues should be seen in a political light. I can assure you that the very militant declarations we hear from our Polish colleagues do not help to resolve the issues facing Poland’s agribusiness sector.

You have no doubt heard the news that a delivery of meat from Poland was seized in Berlin just a few days ago. I will be meeting with my colleague, Mrs Angela Merkel, soon during the G8 summit in Germany, and of course I am not going to say to her, “You don’t want to eat this meat yourself, but you want me to eat it!” Of course I will not say such a thing to her. But the fact remains that this seizure of Polish meat in Berlin suggests that there is a problem with quality. We will work together to settle this issue.

I would just like to add a couple of words on the issue of ‘common values’. The death penalty which is implemented in some Western countries (I will not do any finger-pointing), secret prisons and torture in Europe itself, problems with the media in some countries, laws on immigration that in some European countries do not conform to accepted principles of international law and democracy – this, I think, is also all part of ‘common values’.

So, let us not see the situation as one side being shining white, clean and pure, while the other side is some kind of ‘monster’ that has only just crawled out of the forest, with hoofs and horns instead of a normal human appearance. Let us not use these arguments to settle other issues, problems regarding meat, defence or security. Let us be frank with each other on these matters too, and let us work on these problems in a spirit of reciprocity, playing an open hand with each other and talking to each other without conceit, as partners.

Jose Socrates (simultaneous translation): I would also like to respond to this question.

Positive signals are important but they need to come from both sides. The cooperation between the European Union and Russia is a reciprocal process. Of course there must be positive signals, but they have to come from both sides. I think that both sides will be able to send out these kinds of positive signals to their respective civil societies, because the relations between Russia and the EU are very serious and pursue the goal of strategic partnership.

When I say that these relations are ‘very serious’ I am referring to the fact that they have been of great importance throughout their entire history. Today we need to measure up to this historical importance, take responsibility for the future and build a strategic partnership that we will be able to be proud of in the years to come. We had our backs turned to each other for a long time, but now the time has come when Russia and the EU can work together to build the kind of peace and stability that would make them precisely strategic partners.

Does this strategic partnership imply that we share common values? Yes, it does. Strategic partnership can be based only on common values, but these common values are already a given, for they are the values that we have formed through our long history of living together. If asked whether we need common values such as respect for human rights, democracy and freedom, I say that yes, we do need them, and we want to develop them. But there is an important point to note in this respect, and that is that we need to promote these values without moralising, because there is nothing worse than when one side tries unilaterally to teach the other side some kind of lesson, and this is a situation we must try to avoid.

As I understand our relations, they should be about being honest and open with each other, not moralising, but trying our best and our utmost to promote and develop our common values. Moreover, when it comes to things such as democracy and human rights, I can tell you that no society is perfect. All countries still have much work to do in this area. I think that Russia and the European Union should travel together this road of improving democracy and human rights.

Question: Mr Prime Minister, you are no doubt aware that a Russian investment project to build a plant is underway in the city of Sines. What is your view of Russian expansion in the Portuguese economy? Also, you had a chance yesterday to see new projects in the Russian aircraft manufacturing industry, and I would be interested to hear your impressions.

Mr Putin, I would be interested to hear your views on the prospects for cooperation, especially in the investment sector and in potential exports of Russian aircraft to Portugal.

Jose Socrates (simultaneous translation): To give a very brief answer to your first question, I think the Russian presence in Portugal is a very good thing. One of the aims of this visit was to tell Russian businesspeople that Portugal offers excellent opportunities for Russian investment.

Regarding the Russian national gas company’s project to build a plant in Sines, I think the company has taken the right approach and is demonstrating a far-sighted strategy. This company has realised that Portugal is an excellent platform for sales in Europe and also in Africa and Latin America. We will do everything we can to encourage Russian investment in Portugal. This investment is a natural development given that the Russian economy is not just growing today but is also becoming more and more international. We are not just welcoming Russian investment into our country but are coming here to actively encourage this investment.

And to conclude my response to your question, I would like to say a few words about forest fire-fighting aircraft. We rate very positively the aircraft Russia manufactures for this work. Portugal has already purchased six helicopters for fighting forest fires and we were also very impressed by the Russian Be-200 airplane’s performance in putting out the forest fires last year in Portugal.

Vladimir Putin: One of the objectives the Prime Minister and I worked on is to diversify our economic relations. In this respect, as I said, we welcome the exhibition of Portuguese high-technology products in Moscow.

We are grateful for the positive assessment of the aircraft our aircraft manufacturing sector produces. Portugal has already purchased helicopters and we know that the Be-200 airplane proved its worth during two months last summer in Portugal. We discussed the possibility of opening Russian aircraft sales, service and maintenance centres in Portugal. We can expand on these possibilities by also including cooperation in the shipbuilding and space sectors.

We have many possibilities for diversification. Reciprocal investment is one of the most important areas, of course. In this respect, I am very pleased to see the agreements reached between our financial organisations. The possibilities of Russia’s economy and its private companies are growing. We hope that by combining their respective possibilities, our countries will achieve good results for both economies. We are happy with the approach and the principles the Prime Minister has formulated for practical application to our economic cooperation.