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President of Russia Vladimir Putin: Good afternoon, ladies and gentlemen,

I would like to begin by thanking the President of the United States, Mr Bush, for accepting the invitation to meet here in Sochi in order to sum up, as it were, the almost eight years of our work together. I think George would agree with me that this dialogue has been a positive one overall.

Right from our first meeting in Ljubljana back in 2001, we formed an open and sincere relationship that enabled us from the outset to discuss the most important issues on the international and bilateral agendas without letting convention and hindrances get in the way.

This dialogue is not always easy. Our countries have had and do have their differences on a whole number of issues, but we continue to look for common ground and solutions. As I have already said, George and I have succeeded in organising our work in such a way that, overall, differences in one area do not negatively affect the situation in other areas where we have achieved progress and brought our respective positions closer together. In this way we have reinforced the entire architecture of our bilateral relations.

Both during the preparations for this meeting and during the meeting itself, we carried out a sort of stock-taking of the main issues on the Russian-U.S. agenda. Here in Sochi we have adopted the Strategic Framework Declaration. Of course, the Declaration does not truly resolve a number of the problems we face, but we did not expect this much in any case. The important thing is that the Declaration sums up all that we have accomplished over these last years, be it in security, non-proliferation, including the initiatives we and President Bush have proposed, combating terrorism, and developing our business partnership.

The Declaration also reflects the differences that remain between us, above all concerning military and political matters. But it is important to note that we reaffirm our readiness to work on overcoming these differences. Most important of all is that our countries have made a strategic choice in favour of constructive relations, relations that reach far beyond the limits of the old mutual deterrence model. This is a forward-looking Declaration that, whatever the circumstances, represents, I think, a far more accurate measure of the level our partnership has reached today than stereotypes would lead us to believe.

Of course, we took this chance to put aside protocol aside and talk frankly about all the issues that have been in the forefront on our agenda of late, especially the issues that have a direct bearing on strategic stability and international security in the long term.

I will not hide the fact that missile defence in Europe was and still is one of the most difficult problems. This is not a matter of language, of diplomatic wording, but a problem of substance. I want to make it clear that as far as principle is concerned, our position regarding the U.S. plans remains unchanged. But there are nonetheless signs of progress. Our concerns have been heard by the United States. During the 2+2 meeting in March and again today during the talks with President Bush, we were offered a package of confidence-building and transparency measures in the missile defence area. We sense that the U.S. President is serious and sincere about wanting to find a solution to this problem, and we support this approach in every way.

In principle, suitable confidence-building and transparency measures can be found, and they can be important and useful in helping to resolve problems of this sort. In other words, an avenue for working together has opened up now and we are ready to take it. As for the specifics of the American proposals, it is too early to talk about this just yet. It is a matter for the experts to build on the preliminary agreements, work out the technical details and come to the final decisions. The alternative proposal that we made last year therefore also remains valid and we hope that it will also be the subject of future discussions.

On the issue of strategic offensive weapons, some differences remain in our basic approaches, but both countries support continuing the nuclear disarmament process. This is an area where we also need to find common ground.

Last year in Kennebunkport, Mr Bush and I agreed to start work on a new treaty to replace the START Treaty, which expires in 2009. We agreed that we should keep all the useful and essential elements of the START Treaty’s provisions. We will work on this further. The concerns we share on both sides regarding cutting-edge technology are clear and understood and I hope very much that the specialists will be able to come to some agreements on this these points too.

We also discussed, of course, the Conventional Forces in Europe Treaty and NATO’s expansion plans. Our discussions were very frank and substantial. In any case, I was pleased at the way that our partners listened to us attentively, and I hope that in these areas too we will be able to reach a mutual understanding.

Of course, our Sochi Declaration could not ignore our business cooperation. We reaffirmed our mutual desire for Russia’s speedy accession to the World Trade Organisation on commercially justifiable terms that do not undermine Russian economic interests. In this regard, we hope that the United States will act this year to stop applying the provisions of the Jackson-Vanik Amendment to Russia and re-establish normal and regular trade relations with our country. We also reaffirmed our desire to intensify cooperation between our business organisations. Another important task is that of completing the new intergovernmental agreement on investment incentives and mutual protection for investment.

The energy sector is another major area for cooperation and we already have a good base on which to build. We hope to continue developing our energy dialogue, enriching it with promising new projects in measure with the enormous potential our two countries offer.

This was my last meeting as President of Russia with George, and I would like to take to this opportunity to say once again that it has always been a pleasure and has always been interesting to work with the American President. I have always valued his fine human qualities, his honesty and openness and his ability to listen. These are all things of great worth.

Throughout these years we have been motivated by a sincere desire to strengthen the partnership and build up mutual understanding between our two great peoples, to open up new horizons for cooperation. I am very grateful to George for the fact that much of what we have accomplished on this road has been with the help of his direct participation and support.

PRESIDENT OF THE UNITED STATES GEORGE W. BUSH: Thank you, Vladimir. Thanks for your gracious invitation. This is the very room where you served an unbelievably good dinner last night, with fabulous entertainment. Thank you for your hospitality. Laura and I are thrilled to be with you. And also, thank you for the briefing on the Winter Olympics. I'm sure the people in this area are really excited about the fact that you've been awarded the Winter Olympics. I congratulate you and wish you all the very best. And maybe you'll invite me to come as your guest – who knows.

We spent a lot of time in our relationship trying to get rid of the Cold War. It's over. It ended. And the fundamental question in this relationship is, can we work together to put the Cold War in the past? And I fully recognize there are people in America and Russia that think the Cold War still exists. And sometimes that makes relations difficult. But it's very important for leaders to think strategically and not get stuck in the past, and be willing to advance agendas.

And so we worked very hard over the past years to find areas where we can work together, and find ways to be agreeable when we disagree. And I think we've done a pretty good job of it. And I want to thank you for your openness, as well. It's been a remarkable relationship.

Today, the signing of this strategic framework declaration really does show the breadth and the depth of our cooperation. It shows where we differ, as Vladimir mentioned, but it shows that when you work hard, you can find areas where you can figure out how to cooperate. The document speaks of the respect of rule of law, international law, human rights, the tolerance of diversity, political freedom and a free market approach to economic policy and practices.

One of the areas where we've agreed to work together is in missile defense. And obviously, as Vladimir mentioned, this an area where we've got more work to do to convince the Russian side that the system is not aimed at Russia. As the agreement mentioned, we agree today that the United States and Russia want to create a system for responding to potential missile threats, in which Russia and the United States and Europe will participate as equal partners.

This is a powerful and important strategic vision. It's the vision that Vladimir Putin first articulated in Kennebunkport, Maine. For those of you there, you might remember the moment. And this is what we're building on. We're taking the vision that we discussed in Kennebunkport and now we're putting it in a document form, to help not only this administration but future American administrations work with future Russian administrations on this very important issue.

To help counter those threats, the United States is working with the Czech Republic and Poland, and as the President has done consistently, he expressed his concerns about those relationships. There's no doubt where he stands. That's why I like him. You don't have to guess. And he is concerned about it. Yet Russia appreciates the confidence-building and transparency measures that we have proposed, and declared that if agreed and implemented, such measures will be important and useful in assuring Russia concerns.

He's got doubts about whether or not these systems are aimed at him. My view is, is that the more open we are, the more transparent we are, the more we share technological information, the more likely it will be that people throughout the system understand that this is an opportunity to deal with the threats of the 21st century, such as a launch from the Middle East or elsewhere. And the document shows areas where we agree and where we disagree, but where we can work together in the future. And I appreciate that very much.

We're talk – we're working together to stop the spread of dangerous weapons, and I appreciate the fact that we're implementing the Bratislava Nuclear Security Initiative, which is an important initiative. We continue to work together to meet the threat of nuclear terrorism, including through the global initiative to combat nuclear terrorism. It's an important initiative in which the Russians and the United States have worked cooperatively and have taken the lead.

We talked about Iran. As I told Vladimir, that in the States, when asked about this at the press conferences, I've always told people how much I appreciate his leadership on the Iranian issue. After all, Russia went to the Iranians and said: You should have civilian nuclear power. I agree. He then went on to say: And we'll provide the fuel for you. Therefore, there's no need for you to enrich.

And it's your leadership on this issue, Mr. President, that's very important in making sure that the regime honors the international commitments that we expect it to.

We briefly touched about the six-party talks with North Korea – the need for us to work together to help that nation move forward.

We talked about fighting terror. The United States has suffered terrorist attacks on its soil, as have Russia. And I will tell you, there's been no firmer person in the world who understands the threat of radicalism, and the capacity of these radicals and extremists to murder the innocent people. I remember full well when that happened on your soil. I remember our discussions right after – right thereafter.

And I want to thank you for working hard to deal with terrorist and terrorist financing, to share intelligence to protect our people. That's our most important job. And we improved our relations along these fronts. We did talk about — Vladimir did talk about economic cooperation. I support Russia's efforts to join the WTO. I support Russia's efforts to join the OECD. I think we ought to get rid of Jackson-Vanik. I think it's time to move this relationship in a new light. And I look forward to reminding Congress that it's in our interest to do such.

And so we had – this is a good agreement, and a good understanding. And, Mr. President, this is our last meeting as Presidents and – it won't be our last meeting as people, but it will be our last meeting as Presidents of our country. And it's a little bit nostalgic. It's a moment where it just proves life moves on. And I want to thank you for introducing me to the new President. We had a good meeting. And I appreciate you providing the opportunity for us to meet. And I look forward to working with him through the rest of my term.

In the meantime, thanks very much for your hospitality and your friendship, and for giving me a chance to have yet another press conference with you.

Question: Mr Putin, President Bush expressed the view that it is not entirely clear who will be in charge of Russian foreign policy when you become prime minister. He asked who will represent Russia at the G8? So, who will be in charge? Who will represent Russia at the G8?

President Bush, seven years ago, you said that you looked into President Putin’s soul and decided that he was someone you could trust. Has the same thing happened with the man who will succeed Mr Putin as president?

Vladimir Putin: As far as Russia’s foreign policy is concerned, in accordance with our country’s Constitution, it is the President who is responsible for the country’s foreign policy. This will be the responsibility of President-Elect of the Russian Federation Dmitry Anatolyevich Medvedev. He will represent Russia at all the main international forums, including the G8.

I want to stress once more that over these last years, first as chief of staff of the Presidential Executive Office and then as first deputy prime minister in the Russian Government, and as a member of the Russian Security Council, Mr Medvedev has been one of the co-authors of Russia’s foreign policy. He is thoroughly familiar with all the current affairs and all of our strategic plans and he will therefore be a reliable and dependable partner, well-versed in the subject and ready for constructive dialogue while at the same time upholding Russia’s national interests. I am not sure what more I can really add.

For my part, if I do indeed become prime minister, I can tell you that the Government has quite enough problems and concerns to deal with, above all economic and social matters that need to be addressed. These are the issues of greatest concern to the general public in any country, including in Russia, and I intend to put all my effort and attention into working on precisely these issues.

GEORGE W. BUSH: My comments about Vladimir Putin were aimed to say that I found him to be the kind of person – I thought he'd be the kind of person who would tell me what's on his mind. A lot of times in politics you have people look you in the eye and tell you what's not on their mind. He looks you in the eye and tells you what's on his mind. He's been very truthful. And to me, that's the only way you can find common ground, and to be able to deal in a way that you don't let your disputes interrupt your relationships.

And, you know, I just met the man for about 20 minutes, the President-Elect, and it seemed – he seemed like a straightforward fellow, somebody who would tell you what's on his mind. But he is – he is not the President. This man is the President. So our conversation was – he was very respectful of the fact that he is waiting his time until he gets duly sworn in as President of the Russian Federation. And then he'll act as the President.

And so my first impressions are very positive – smart fellow. You know, I got to see him at Crawford once before, and then he came to the White House, I think with Vladimir, and then came on his own one time. But we never really had a full discussion. And I just repeat to you, from my observation, he understands there's a certain protocol, and that he is taking his time, he's studying, he's preparing to assume office. But he is not going to act like a President, nor assume presidential duties until he gets to be the President.

And so you can write down, I was impressed and looking forward to working with him.

Question: Vladimir Vladimirovich, the Declaration makes clear that you discussed the missile defence issue but that concerns remain. In other words, the problems regarding a third missile defence site in Europe have not been settled?

And a question for Mr Bush: you spoke about transparency, but will you be able to convince your Polish and Czech colleagues to be as transparent as you intend to be on the missile defence issue?

Vladimir Putin: Yes, it is true that we have not settled all the issues regarding missile defence and a third missile defence site in Europe. But as I already said, we saw today that our American partners not only understand our concerns but are also genuinely committed to finding a solution.

Furthermore, I am cautiously optimistic about our ability to reach a final agreement. I think that this is possible. But the devil, as is so often the case, is in the details. In this context, it is important that our specialists meet at expert level to agree on the confidence-building measures and how they will be carried out in practice. This is the most important thing.

Finally, a third point I want to mention, and something George also mentioned, was that it would be good for us to work together on these systems. I think this is the most important point of all. If we succeed first at the expert level and then at the political level in agreeing to work together on a global missile defence system, which is what we are talking about now, and if we agree on a missile defence system for Europe, if we can start working together on a global missile defence system, this would be the biggest and most important result of all the work we have done so far.

GEORGE W. BUSH: Precisely, what he said is true. And that is, that is if we can, first of all, earn enough trust to be able to cooperate regionally and then globally, that's in our interest, because one of the concerns from the Russian side, a clear concern is that if they believe the system is aimed at them, they're going to obviously do something about it. They'll spend money to avoid the system.

And I view this as defensive, not offense. And obviously we've got a lot of work to do to convince the experts that the system is not aimed at Russia. It's really to help deal with the threats that we all are going to face. And, therefore, the vision about having a global system is something I strongly support, where we're working cooperatively together. Look, there's a lot — we got a lot of way to go.

And as to your question about the Czech Republic and Poland, it's important for the leaders in those countries – and I've discussed the issue with them – to understand that Russia is not an enemy, Russia is somebody with whom we need to work. And we'll work through the differences there, as well. Transparency is going to require more than just a briefing. Transparency is going to require true openness in a system.

I have no problem with that. I have no problem sharing technologies and information to make sure that all people understand this system is designed to deal with multiple – I mean, single or dual-single launch regimes that could try to hold us hostage. This system is not designed to deal with Russia's capacity to launch multiple rockets.

Now, we got work to do, but we've come a long way since our first discussions. And this document really does express a vision that will make it better for America and Russia when – to work together along these lines. And so, yes, I thank you for your question.

Question: President Bush, your joint statement on missile defence does not indicate Russia’s acceptance or recognition of this system. As for the new American administration, it might perhaps not support this system at all?

Mr Putin, can you tell us what needs to be done to convince you that this system is not a threat to Russia’s security? And how will Russia respond if the United States does go ahead with this system and if Ukraine and Georgia join NATO?

GEORGE W. BUSH: I think I just explained how far we have come on this issue. This is a concept that I talked to Vladimir about a while ago, and we have come a long way. Read the document and read what it says. It clearly talks about a strategic relationship. It talks about the need for transparency and confidence-building measures. It is a really good opportunity to put a framework in place for our nations to work together.

Now, you can cynically say it's kicking the can down the road. I don't appreciate that because this is an important part of my belief that it's necessary to protect ourselves. And I have worked — reached out to Vladimir Putin. I knew this was of concern to him, and I have used my relationship with him to try to get something in place that causes Russia to be comfortable with it.

Is it going to happen immediately? No, it's not going to happen immediately. But is this a good opportunity to work together? You bet it is. For the common good. And so I feel comfortable with it, and I think it is – you know, I happen to believe it is a significant breakthrough, simply because I've been very much involved with this issue and know how far it's come.

Vladimir Putin: What could convince Russia that this system is not directed against our country? Let me list several points. First, and best of all, would be joint work on a global missile defence system with equal and democratic access to its management. This is what George was just talking about when he said that we could organise data exchange at the technological level and carry out work together. If we did manage to get this kind of joint work underway – with equal and democratic access to the system’s management, as I said – this would be the best security guarantee for all of us.

If we do not manage to achieve this for the time being, then what Russia wants is for the transparency we just talked about, the verification measures to be clear, objective and ongoing, carried out using technical means and also with the help of personal observation by experts, who should have a continuous presence at the sites in question.

That is my answer to the first part of your question.

As for NATO’s expansion, this is something we discussed in considerable detail today. I once again set out Russia’s position on this issue to George. In my view, if you want to improve relations with Russia, rather than trying to draw former Soviet republics into a military-political bloc, you should be working on improving and developing relations with the Russian Federation itself. Perhaps then, several years down the road, NATO’s future actions on certain issues might not cause such a sharp reaction in our country as they do today.

In purely technical terms, NATO’s expansion, as I see it, continues the old logic behind the policies in place at a time when Russia was seen as an adversary at the very least. But this is no longer the case today. As Churchill put it, inability to change the subject is a sign of radicalism.

Question: I have a question for both presidents. You said that you have summed up eight years of your work together. Looking back over this work, were there more pluses or minuses? What have you achieved and what specific legacy are you handing on to your successors? Do you think the world has become a safer place, and do you think that Russian-American relations have influenced world politics?

And a question for the U.S. President: you met today with Russian President-Elect Dmitry Medvedev and you described the impression he made on you. Did you schedule any contacts until the end of this year?

Vladimir Putin: Let me begin answering your many-faceted question. Have things become better or worse? In general, we always want more and better, but let’s not forget that too much of a good thing is also not without problem. We should recall for a moment how the world was on the brink of nuclear war during the Cuban missile crisis, and compare that to relations between the United States and Russia today. It would have been impossible to imagine back then.

I fully agree with George when he says that Russia and the United States no longer see each other as enemies and adversaries. At the very least we see each other as partners, and I think this is very important.

Yes, we still have many unresolved problems, and yes, we have our differences on some very sensitive areas of our relations, but we nonetheless have the strength and desire to look for solutions. And, as our meeting today showed, we can achieve positive results. Overall, our efforts to combat international terrorism, prevent proliferation of weapons of mass destruction and missile technology, and fight international crime and drugs trafficking all go to form a solid foundation for cooperation between our two countries and are also an important factor in international security.

If we add to this our growing economic ties, it is clear that we have accomplished much over these last eight years to improve relations between our countries and the situation in the world in general.

GEORGE W. BUSH: Yes, I agree with that answer. And secondly, I spent – I told President-elect that I would see him in Japan at the G8, and that's the only scheduling matters that we discussed. And I'm going to finish out my term – my time with Vladimir, and then I'll turn my attention to the President when he gets to be the President. But the first time I suspect we'll meet will be in the scheduled meeting in Japan.