[Weekly Compilation of Presidential Documents Volume 37, Number 30 (Monday, July 30, 2001)]
[Pages 1081-1086]
[Online from the Government Publishing Office, www.gpo.gov]

<R04>
 The President's News Conference With President Vladimir Putin of Russia 
in Genoa

 July 22, 2001

     President Putin. Good morning. We've just finished a meeting with 
the President of the United States and discussed the issues on a whole 
wide range of subjects. First and foremost, I wanted to say with great 
satisfaction that our meeting was held in a very frank and open 
atmosphere, and there is no doubt, absolutely, that I can say and 
confirm that we've maintained, not only, but in many ways strengthened 
the spirit of Ljubljana.
     Naturally, we discussed the issues that were raised at the G-8, 
issues of security, environment, education, security. And the issue here 
led us to discuss the world architecture of the 21st century and the way 
to improve civilization in the future.
     I can frankly tell you that this part we discussed together. Just 
one-on-one with the President, it seemed to me that his thoughts and his 
mental reasoning is very deep, very profound. We were both very 
interested in having a continuation of this dialog with the American 
people, with its leader. Approaches which were stated by the President 
in the past, without any doubt, are going to be studied by us, and I can 
repeat once again will be positively accepted.
     President Bush and I have analyzed how our recent accords are now 
being implemented. We've put forth several new steps in terms of setting 
forth a long-term cooperation which is not subject to any kind of 
dealmakings but a very good, sound, long-lasting attitude. Today in 
Russia we have a very positive dynamism, and we have stated that, as 
well.
     The differences in approaches on a couple of topics is still there. 
However, what is more important is that we are aimed--both of us are 
aiming at partnership, to look forward, well reasoned, well balanced, 
carefully weighed approaches and solutions.
     Naturally, we discussed the issue of strategic stability. There we 
spent a lot of time. We talked in great detail. We've reached a most 
important accord, agreement on the beginning and the schedule for 
consultations. In Ljubljana we talked about setting up a working group 
or series of working groups. As you know, in Moscow here, in a few days, 
Condoleezza Rice will come to visit us, and we will work out, finally, 
the group structure within the overall interagency structure of foreign 
ministry, defense ministry, and others.
     I have to say that to some extent what was unexpected both for me 
and, I think, for President Bush, as well, was the understanding that 
was reached today between us on the issue that the offensive arms and 
issue of defensive arms will be discussed as a set. We're going to be 
talking about the mutual striving toward cutting back significantly 
offensive arms. We're not really ready at this time to talk about the 
threshold limits or the numbers, themselves, but a joint striving exists 
and the specialists will get together, and they'll make some 
recommendations. But we are aiming at moving in that direction.
     I told the President of the United States about our proposal, vis-
a-vis, the start of consultations on strategic stability issues as a 
whole. And I think that in the very nearest future, I repeat once again, 
that our specialists are going to work in this direction. I think 
they're going to make a lot of progress and be quite successful.
     Naturally, we discussed very, very sharp problems in regional 
issues. We talked about joining our forces in trying to solve some 
conflicts. We repeat again that the overall dialog on getting our 
positions coordinated is the very best approach to U.S.-Russian 
relations.
     Bilateral issues were especially stressed, economic cooperation. 
And I have to say here that we have a common approach towards developing 
very dynamically in this sphere. We have very good precedents and very 
good foundations for this.

[[Page 1082]]

     We also know that our business societies are also very interested 
in this. We've discussed a series of contacts and the schedule for 
upcoming contacts in the economic field, talked about our next meeting, 
the nearest one will be the APEC meeting in Shanghai, and then the 
President very kindly confirmed his invitation to me to come to the 
United States, and we talked about that agenda, too.
     So that's all I wanted to say as an opening remark.
     Thank you very much.
     President Bush. Thank you, Mr. President. First, both of us believe 
strongly that the summit we just attended was a success, and we want to 
thank the people of Italy and Genoa for their hospitality.
     Secondly, we did have a very constructive dialog--certainly made--
made my impressions of Slovenia--confirmed my impressions of Slovenia, 
that this was a man with whom I could have an honest dialog, that we can 
discuss our opportunities and have frank discussion of our differences, 
which we did.
     I appreciate so very much President Putin's willingness to think 
differently about how to make the world more peaceful. He cares deeply 
about the citizens of his land. I, obviously, care deeply about the 
citizens of my land. We're young leaders who are interested in forging a 
more peaceful world.
     And along these lines, as the President said, that we're going to 
have open and honest dialog about defensive systems as well as reduction 
of offensive systems. The two go hand in hand in order to set up a new 
strategic framework for peace. And along these lines, as the President 
mentioned, my National Security Adviser, Condoleezza Rice, will be 
visiting in Moscow, the purpose of which is to lay out a specific 
timetable of discussions between our defense ministers and our foreign 
ministers.
     So as we can continue progress to find common ground in a--to make 
the world more peaceful, both of us want to seize the moment and lead. 
And I appreciate this attitude so very much with President Putin.
     Secondly, we did talk, spent time discussing economic cooperation. 
There will be a statement put out after the meeting on both, by the way, 
the strategic framework discussions as well as the economic cooperation 
along these lines. Secretary Evans and Secretary O'Neill will be in 
Moscow next week to discuss a wide range of topics.
     But one of the things that is clear and evident is that the 
President understands the need to create a framework for entrepreneurial 
activity. As I mentioned in my last press conference, I will mention 
this again, I am impressed by the fact that he has instituted tax 
reform, a flat tax. And as he pointed out to me, it is one of the lowest 
tax rates in Europe. He and I share something in common: We both proudly 
stand here as tax reformers. And I think the American business leaders 
who look to Russia will appreciate certainty in the tax code and 
certainly will appreciate a lower tax rate than in other places.
     But we've got a lot of areas for growth and discussion, ranging 
from international trade to investment opportunities within the 
Federation.
     With that, I will be glad to answer--both of us will be glad to 
answer a few questions from you. Let's make your questions short, so 
that we won't leave my wife waiting at the tarmac in Rome. [Laughter]

 Strategic Stability/Global Warming

     Q.  You were saying just a little while ago about how strategic 
stability and space has been discussed. How do you see the biggest 
difficulties in this dialog? What are the principal differences between 
the two countries? And how do you see overcoming these differences?
     And your proposal on conference, holding a conference in Moscow on 
the environment, how were the other G-8 partners receiving your 
invitation to Moscow?
     President Putin. As far as the ABM Treaty and the issues of 
offensive arms, I've already said we've come to the conclusion that two 
of these issues have to be discussed as a set, as one set. This is no 
doubt whatsoever; one and the other are very closely tied. Neither one 
nor the other side should feel it's somehow threatened or constrained.
     I felt and continue to feel that these most important kinds of 
issues--we have to maintain a balance, thanks to which mankind could 
live in an environment of stability and

[[Page 1083]]

relative peace. This is an issue of principle, and that's first.
     Second, we share the position of the U.S. President on the need to 
have large cuts in offensive arms. I've already spoken to this, and 
together, we're going to move forward in this direction, substantially 
changing the situation in the world, making it better throughout the 
whole world, reducing the thresholds of confrontation. Without any 
doubt, this would ameliorate the climate throughout the whole world. 
There has to be absolutely no doubt that this is going to happen.
     Now, as far as your issue on the international conference in Russia 
on the ecology or the environment and reducing the dangers to the 
environment, I can say the following: Prior to coming here to Genoa, I 
held a meeting with our specialists, with our physicists, our 
scientists, members of the cabinet who are involved in environmental 
affairs. And I have to say that in Russia, we have some people, some 
specialists who are known throughout the world, really big-time 
specialists, and they told me that even if we fully implement the Kyoto 
Protocol, fully, this is going to affect the climate as it is today, but 
the changes to that will be very minor. In other words, the Kyoto 
Protocol is simply not sufficient to substantially improve the ecology 
in the world, although the movement that we're moving in is in the right 
direction.
     But I want to say that Russia is still for the Kyoto Protocol. But 
what's important is that the scientists themselves, political leaders, 
ecologists, people in society, Government leaders, never, ever got 
together once. Each of these groups sits there alone and out of their 
own corner reviews this issue. And the thought was to get everybody 
together on one common platform.
     This was supported very energetically by the President of the 
United States and by other colleagues. Along with that, President Chirac 
stressed the need to attract the civilian population, the non-
specialists, to have them participate, people from society at large. And 
for this, I want to thank our colleagues for having supported this.
     Thank you very much.

 ABM Treaty/Nuclear Arms Reductions

     Q.  President Putin said several days after your first meeting that 
Russia would increase its nuclear arsenal--[ inaudible]. Have you 
convinced him to scrap the ABM Treaty without building up his nuclear 
arsenal?
     And to you, Mr. President, you just said there is absolutely no 
doubt that there will be reductions on the Russian side of its nuclear 
arsenal. Does that mean that you are no longer saying that you will 
increase your arsenal if the U.S. proceeds with missile defense? Have 
you changed your position?
     President Bush. Well, first, Ron [Ron Fournier, Associated Press], 
let me start by saying how optimistic I am about the possibilities of 
reaching an accord. One of the things about the person with whom I'm 
talking, President Putin, is that he has agreed, like I have agreed, to 
find common ground, if possible. So I believe that we will come up with 
an accord. Let me say this: I know we'll work hard to an accord, to see 
if we can't reach an accord about both a new strategic framework for 
defensive weapons as well as the need to reduce offensive weapons in 
order to make the world more peaceful.
     The only thing I can do is characterize, once again characterize 
our discussions as open and optimistic and very positive. I was struck 
by how easy it is to talk to President Putin, how easy it is to speak 
from my heart, without, you know, fear of complicating any relationship. 
And I enjoyed listening to what he has to say, as well.
     I'm optimistic that we can get something done. And it's with that 
spirit that we send Condi Rice to Moscow to formalize the process, to 
answer questions. Inevitably, there will be questions because, after 
all, what we're talking about doing is changing a mind-set of the world. 
We're basically saying, the cold war is forever over, and the vestiges 
of the cold war that locked us both into a hostile situation are over. 
And we're exploring the opportunity to redefine the strategic framework 
for keeping the peace not that as existed in the past but a strategic 
framework as we go out in the 21st century. It's an exciting 
opportunity. And I can tell you that the discussions have been very 
meaningful.
     Mr. President.

[[Page 1084]]

     President Putin. Thank you. Now, as far as possible answer or 
response, as you say, from Russia, in the event that one side leaves the 
ABM Treaty, from the 1972 treaty, then I can say the following: We were 
talking about the possible kinds and versions of response in the event 
that one side comes out unilaterally. I was not talking about increasing 
the missiles. I was talking about how you would substitute single-unit 
warheads, make them MIRV warheads.
     But as we said today--if as we said today and if as we understood 
from each other today, we are ready to look at the issue of offensive 
and defensive systems together as a set, we might not ever need to look 
at that option. But this is one of the subjects of our future 
discussions.
     As a whole we agreed, in general, that in any version, today we can 
go forward toward reducing offensive arms. I'm telling you this with 
full responsibility, and I'm telling you that within--this is an issue 
of the qualitative and quantitative numbers. But this is, of course--
we'll let the specialists sit down and talk about those numbers.

 G-8 Summit

     Q.  A question to both Presidents. Please tell us how you assess 
the Genoa summit results from the point of view of the future G-8s, 
because you've got all these anti-globalist demonstrators and others.
     President Bush. Well, I'm looking forward to future G-8 summits. 
People should be allowed to protest in a peaceful way. The great thing 
about freedom is, it provides an outlet for people to express their 
differences.
     Having said that, I believe that which we discussed today and the 
last couple of days will make the world a heck of a lot more prosperous 
and peaceful place. The philosophy of free trade and starting a new 
round of free trade discussions makes eminent sense, not only for those 
who happen to be prosperous today but for those who aren't.
     And all the demonstrators and all the folks have to do is ask the 
leaders who came from the developing nations. Ask my friend from El 
Salvador what trade means to him. And so I reiterate what I said before. 
People are allowed to protest, but for those who claim they're speaking 
on behalf of the poor, for those who claim that shutting down trade will 
benefit the poor, they're dead wrong.
     President Putin. I have to tell you that the people who are out on 
the streets, then talked about the issues of the poor countries and 
their problems, and those who gathered within the framework of the 8 
were all taken by one and the same series of issues. In this sense, we 
can say that we're all of the same mind. But unlike those who chose the 
extremist ways of expressing their minds, those who worked here tried to 
find solutions, ways to get to the end solution, specific kinds of 
solutions, which realistically could affect, I hope, will affect the 
condition in which the very poorest countries are living in the world 
today.
     That's why I very highly praise the results, the level, and the 
nature and the character of these discussions. I think we need these 
kinds of meetings, and I think they will continue. Naturally, we're 
going to have to pay more attention to the quality of the kinds of 
decisions that we take and how to implement them fully to the end.
     Now as far as the dialog with civil society, one of the fora and 
one of the ways of discussing is in a civilized fashion. We can only--
and one of the ways of doing it is holding the international conference 
in Moscow in 2003 and talking about the environment.
     Thank you.

 Strength of the Dollar

     Q.  Mr. President, I understand that currency issues were discussed 
at the leaders' summit. I'm wondering, how did you explain the benefits 
of a strong dollar, since you've already acknowledged that it hurts U.S. 
exporters, and over here it's putting inflationary pressure on the ECB 
and stopping them from cutting interest rates?
     And President Putin, I'm just wondering how does a strong dollar 
affect your economy? Thank you.
     President Bush. Well, let me reiterate what I said after my World 
Bank speech. The dollar needs to float in the marketplace, and that the 
dollar--if the market is allowed to function, the dollar will be at an 
appropriate level. And there are both, obviously, there are some that 
want us to artificially--the dollar in our country, and that's not the 
role,

[[Page 1085]]

in my judgment, of the country. The market ought to do that, not the 
Nation.
     And so I continued to assure my friends and allies that we will let 
the market adjust. I also assured them that we were taking the steps 
necessary within our country to strengthen our economy.
     I was able to herald the fact that the first rebate checks made it 
into the mail, and I heralded it from a remote location, here in Genoa. 
And the reason I bring that up is that many of the world leaders are 
deeply concerned about the slowdown of the U.S. economy and its effect 
not only on the dollar but also the effect on trade. And I assured them 
that from a fiscal perspective: One, we're going to hold the line on 
spending, that we had a budget, and I expect Congress to meet the 
budget; secondly, that we did reduce taxes substantially and the first 
wave of tax relief was in the mail; and thirdly, that our Fed, 
independent of the Government, was making the monetary decisions. And I 
think people were pleased to hear that we're working hard to revitalize 
our economy.
     President Putin. The United States are the main trade and economic 
partner for Russia. And this is the main investor in Russia, of all the 
investors, and one of the main economic and trade partners. So the 
stability of the U.S. economy substantially affects our economic 
situation.
     As you know, over the last year in Russia we've noticed certain 
positive trends, and there is no doubt in our minds that we're 
interested in the stability of the U.S. economy as a whole and their 
currency. The dollar for us is the most important--the main form of 
payment in most of our operations.
     Thank you.

 Situation in the Balkans and the Middle East

     Q.  Which regional conflicts, in your estimation, are the greatest 
threat to international security? What were the results when you 
discussed these issues at the G-8? And what jointly could U.S. and 
Russia do in this arena?
     President Putin. Well, of course, these are the Balkans and the 
Middle East, above all. I have to say that I'm satisfied by the nature 
of the results of this discussion. But it seems to me that this time we 
heard each other--heard each other much more, much better, understand 
each positions much better in all these conflict areas.
     And what's important--I don't know if my colleague will agree with 
me, but I get the feeling that trust in each other, within the framework 
of trying to settle these issues, is beginning to arrive. This is very 
important foundation, trust. So we're going to continue coordinating our 
efforts both in the Balkans and the Middle East, taking into account the 
interests of all the parties that are drawn into this conflict.
     And on the way toward coordinating our efforts, we have to work out 
unified approaches. And this--here lies the success. This is very 
important. Because if we create some kind of cracks or fissures through 
which you can have leakage of certain extremist forces, it's going to 
wreck the whole process. So here, getting together, drawing together, 
here was very positive and a positive nature.
     Thank you.

 U.S. Global Warming Proposal

     Q.  Thank you, sir. Mr. President, President Chirac and Prime 
Minister Chretien both say that you promised to have a global warming 
package ready for the Marrakech meeting in September. Your staff says 
that that's not quite true. Who is right, sir? What exactly did you tell 
the leaders?
     President Bush. Well, given the room temperature here I'm not 
surprised you brought up the subject of warming. [Laughter] So I'll try 
to keep my answer short, for the benefit of all, particularly those of 
us who must do something in Rome.
     Here's what I said: I said my administration has had a full-scale 
review of the climate issue; that we're in the process of developing a 
strategy as quickly as we possibly can and one that we look forward to 
sharing with our friends and allies; a strategy that begins with the 
notion that we want to reduce greenhouse gases in America; a strategy, 
also, that takes a realistic look at how best to do so, a look based 
upon science and a look with the notion that we can have economic growth 
and sound environmental policy.
     I made it clear to our friends and allies that the methodology of 
the current protocol

[[Page 1086]]

is one that, if implemented, would severely affect economic growth in 
America, and that I believe that it makes sense for those who trade with 
us to make sure that our environmental policy is one that continues to 
stimulate economic activity so that trade means something between 
nations.
     The spirit of our dialog was very positive. I guess you could say 
that I broke the ice during my last trip to Europe, so people understood 
exactly where I was coming from. There should be no doubt in their mind 
about our position, that we share the goal, but we believe that--
strongly believe that we need to find a methodology of achieving the 
goal that won't wreck the U.S. economy.
     And we're making progress on that. I'm very confident that the 
leaders appreciated my straightforwardness the last time I came to 
Europe and my willingness to continue to dialog on this very important 
issue.
     We have a representative at the Bonn summit. I saw her on TV the 
other day; she made the case very clearly--Paula made the case very 
clearly about what our position is. And the Europeans are interested in 
the strategy that we're going to adopt. And when it's formulated, I will 
present it to them, and I look forward to doing that. And they're going 
to find out that when I say we're interested in reducing greenhouse 
gases that we mean it. They're also going to be pleased to hear that 
it's going to be in such a way that won't damage their largest trading 
partner, and so will the American people, who want to make sure that 
there's work and jobs available.
     With that, I want to, again, thank my friend. I look forward to 
future dialog. Thank you all very much for your questions. And again, we 
thank the good people of Italy for their kind hospitality.
     President Putin. Thank you very much.

  Note:  The President's 13th news conference began at 2:52 p.m. at the 
Palazzo Doria Spinola. In his remarks, he referred to Paula J. 
Dobriansky, Under Secretary of State for Global Affairs. A reporter 
referred to Prime Minister Jean Chretien of Canada. President Putin 
referred to President Jacques Chirac of France; MIRV, the Multiple 
Independent Reentry Vehicle; and ECB, the European Central Bank. 
President Putin spoke in Russian, and his remarks were translated by an 
interpreter. A portion of this news conference could not be verified 
because the tape was incomplete.