DMITRY MEDVEDEV: Ladies and Gentlemen,

First of all, I would like to express my satisfaction with the meeting I just had with the Federal Chancellor. This was our fourth meeting. Of course we discussed the most current events and above all the tragic consequences of Georgia's aggression against peacekeepers and civilians in South Ossetia.

You know that these acts have caused numerous victims and led to floods of refugees, large-scale damage and other serious consequences that can only be called a humanitarian disaster.

The Georgian leadership bears full responsibility for these illegal and ruthless actions. All of the many diplomatic efforts and talks in different formats, successful and unsuccessful, over these last 15 years were undone in a matter of hours by these acts of force. It gives the impression that Mr Saakashvili was simply sick and tired of diplomatic efforts and decided to solve all the problems and remove the obstacle of the Ossetians in one clean blow. This is why the operation was named accordingly "Clear Field".

As you know, we responded with a number of measures to put an end to these actions. Russia remains the one force in this situation that can protect the civilian population and the Russian citizens living there. We took appropriate measures based on our right to self-defence in accordance with Article 51 of the UN Charter.

Security has been restored and Russia's peacekeepers remain the guarantors of this security in the Caucasus. Unfortunately, there are still a number of difficulties, but nonetheless, we and President of France Nicholas Sarkozy agreed on a set of basic principles for resolving the conflict and we think they provide a necessary and sufficient base for achieving a settlement. It now remains for Georgia to give its agreement to these principles, which must then be enforced under guarantees from Russia, the Council of Europe and the OSCE. I hope that this will all happen very soon. We are waiting for confirmation.

We also talked about the need for an objective evaluation by the international community of the tragic events that took place in South Ossetia. I stress that this must be an objective and not one-sided evaluation, not biased one way or the other.

But even more important now is to provide full support for the people affected by this humanitarian disaster. We need to ensure their security, give them medical assistance and rebuild the infrastructure that was destroyed. This is the task we need to concentrate on now.

I said yesterday and repeat now that peace in the region needs to be restored and guaranteed so that no one is tempted by such idiotic ideas again. I think that this is the Russian Federation's primary task today.

Mrs Merkel and I will continue our discussions of various issues of course, but the start of our talks was devoted naturally enough to these tragic events.

ANGELA MERKEL (retranslated from Russian): I would like to thank you once again for the invitation to come here to Sochi. We have not yet been able to talk about all the topics that we originally wanted to discuss, for obvious reasons, and of course the international situation and the situation here in the region have been the main subjects in our conversation. We talked with each other very openly in conveying our views of the situation. And I said very clearly that of course it is always a great pity when there are victims and here unfortunately there are many, many victims, but that even when you take into account Russia’s description of the situation, I would still say that Russia’s reaction has been disproportionate, and that the presence of military forces in the very heart of Georgian territory is wrong. Therefore the immediate implementation of the six principles agreed to is urgently needed so that Russian troops will withdraw from the territory of Georgia. I hope that there will be progress and that all parties sign the plan.

I am pleased to hear that the Russian side considers this plan a good basis for a settlement. I thought it was a good idea that Nicolas Sarkozy, in his role as President of the European Union, go to Moscow and Tbilisi precisely to organise and develop such a framework. This does not mean that the conflict is resolved but at least it represents progress.

I think that now we need to fix our eyes on the future. And in this regard it is very important that the issues Mr Medvedev mentioned were added to the statement. First and foremost is the question of a withdrawal to the lines agreed to in the plan.

The second question concerns humanitarian assistance. I clearly expressed the hope that we will deliver humanitarian aid to Georgia as well as to South Ossetia. And in South Ossetia, irrespective of the nationality of people, Ossetian or Georgian, it is very important that international organisations be able to distribute humanitarian aid. And I think that this plan – I hope I’m right -- can be implemented as soon as possible.

Then we talked about the need for more international observers in the region. The Russian side also sees this as a possibility. I think it is important that those peacekeeping forces there under the auspices of the OSCE be able to observe the situation and to establish an objective and informed view of the situation.

The third point is that of course we have to discuss how the situation will evolve from a political standpoint, because for a long time, more than a decade and a half, we have not been able to find at the political level a political solution to this conflict, and we cannot wait another 15 years to find a stable solution. The starting point should be the territorial integrity of Georgia.

I think it is right that in difficult times we speak openly with each other and stay in constant contact with each other. This is the principle of the French presidency, and it is also my principle. Then we need to discuss different views step by step, and move forward in that way.

QUESTION: Looking beyond the horizon a little, among the six principles President Medvedev and President Sarkozy discussed was the principle of holding international discussions on the future status of South Ossetia and Abkhazia. Mrs Merkel just said that Georgia's territorial integrity is an unshakeable principle as far as Berlin is concerned. The Russian authorities say that they will listen to the will of the Abkhazian and Ossetian peoples, who have already expressed their will in referendums. They expressed a desire to secede and form an independent state or join the Russian Federation.

My question for both leaders is how do you intend to reconcile these contradictory positions?

DMITRY MEDVEDEV: There are contradictions that cannot be reconciled but that can be resolved. The whole reason they are contradictions is that the different positions often cannot be reconciled. If there was another way out of this situation it would probably be good to use it, with regard to the question of status I mean. Nobody is rejecting the principle of territorial integrity as one of the fundamental principles of international law. The question is one of a specific situation in a specific country. This is where the main difficulties start.

Unfortunately, after what has happened, the Ossetians and Abkhazians are unlikely to be able to live in one state with the Georgians, or some kind of titanic efforts would have to be made to resolve the conflict. But as I said at my meeting with Mr Sarkozy and also during my meeting yesterday with the leaders of the unrecognised territorial entities - South Ossetia and Abkhazia, and again during my meeting with Mrs Merkel, as the guarantor of security in the Caucasus and in the region, Russia will accept the decision that reflects the clear will of these two Caucasian peoples and will use it as the guideline in its foreign policy and guarantee its enforcement in South Ossetia and Abkhazia in accordance with the peacekeeping mandate that we have. This is my view with regard to this situation.

ANGELA MERKEL: First and foremost we need to find a format in which such negotiations can take place.

Germany supported the creation of a group of friends of the UN Secretary-General, designed to start negotiations, particularly with Abkhazia. Foreign Affairs Minister Steinmeier began this work during the summer. Just how these formats should be designed needs to be discussed. They must be constituted in accordance with international law. The main postulate here should remain the territorial integrity of Georgia.

As far as the many conflicts around the world are concerned, we don’t think that there is a single answer to all these different problems, but it is important that the rights and security of all these people be guaranteed. We have to negotiate the extent to which we can talk about different sorts of autonomy or other possibilities. And, as I have already said, not every nation in the world that wants to secede from a state is capable of independent existence as a state, as Russia knows perfectly well. If it were so, there would be a lot of problems in the world. Therefore, each case in the world should be considered in isolation.

If there is a lesson to draw from this situation it is that we must not simply put these problems into cold storage again, but rather try to resolve frozen conflicts, as we have called them for a long time now, as quickly and as efficiently as possible.

QUESTION: Mrs Federal Chancellor, I have two questions.

First, before you set off on this visit, there was talk that Russia would present you with proof of acts of brutality. Was such proof given?

Second, agreements on NATO membership were reached at the Bucharest summit. Do these agreements still hold today?

ANGELA MERKEL: The President of Russia has conveyed his views to me. He said that in the course of this conflict really terrible, cruel things occurred. He didn’t have to prove this to me. For both sides in such conflicts it is always dreadful and terrible, and that is why we talked about the need for humanitarian assistance.

In doing so, we must not lose sight of the fact that there are thousands and thousands of refugees, people who no longer have a home, for whom everything has been destroyed and who have been forced to flee. This should be the priority in our negotiations. And I think there’s no need for an assessment of specific details or the presentation of some kind of evidence.

Second: we did have very intense discussions about the implementation of the six principles programme. I think that for people who suffered there it is most important that we establish some sort of reasonable base with this plan.

The second question: as far as Bucharest and the agreements reached there are concerned, they continue to operate. I see no reason to reconsider them. We said then that Georgia and Ukraine are going to become members of NATO. We said that preparation for membership is the next step. We said that they will be members of NATO, if they so wish. And this postulate remains valid.

DMITRY MEDVEDEV: I would just like to add a couple of words.

We do not need to prove anything, but regarding the information you refer to I have simply not had time to pass it on yet. The photographs and the disks that contain all the information on the humanitarian problems, the destruction and the killings and wounding of civilians will be passed on.

QUESTION: My first question is for the Russian President.

Dmitry Anatolyevich, is Russia open to the possibility of peacekeepers or international forces from the West being deployed in the conflict zone?

I also have a question for the Federal Chancellor.

Mrs Federal Chancellor, could you comment on the fact that when the Georgian President declared war, he did so with the European Union flag in the background.

Also, do you think there is any truth in the Georgian President's statement that Russian troops destroyed Tskhinvali, remembering that Russian peacekeepers are stationed there and Russian citizens make up 80 percent of the town's population?

Thank you.

DMITRY MEDVEDEV: As far as peacekeepers are concerned, of course we are not opposed to having international peacekeepers there. It is not our position on the matter that is the issue. We are carrying out our share of the responsibilities for ensuring security in this very complex region. But the issue is that the Ossetians and Abkhazians themselves trust only the Russian peacekeepers because the events of the last 15 years have shown them that the Russian peacekeepers are the only force able to protect their interests and often their very lives. This is why they see the Russian troops as the only guarantee of their security, and this is something that also has to be taken into account.

I can give you an example from a recent and also very complicated case, that of Kosovo, when Kosovo rejected the participation of peacekeepers under UN mandate and asked for peacekeeper units formed on the basis of a special European Union mandate, and this request of theirs was met. I do not intend to go into an assessment of the situation there, but at the very least, people who face oppression, pressure or genocide have to feel comfortable with the force charged with bringing peace and tranquillity to country.

We will therefore discuss these questions of course, and we have already begun discussing the presence of international observers in one form or another, including through taking the additional security measures provided for in the fifth principle agreed on with the French President. This process will continue, but I wanted to draw your attention to the fact that in this situation the position of the people affected, the people who have been subjected to violence and aggression, remains paramount.

ANGELA MERKEL: On this subject, I would only say clearly that of course we cannot send a peacekeeping force that has not been accepted by all the parties concerned. We sent a KFOR mission [a UN-mandated NATO-led peacekeeping force] to Kosovo and police forces. They are there now, and the European side wanted to provide them. Prior to that there were UN forces. This will need to be negotiated here, but from a political standpoint we have said that the European Union is open to such negotiations. And so we will have to wait a bit. All this is important to understand when trying to answer the question about whether in the near future we will energetically send international observers along with peacekeeping forces, if that is the right term. In addition, we also talked about the need for an international component. I think it would be useful to all parties, because international public opinion is of course monitoring the situation, and this would give us a higher level of objectivity.

With regard to the German side, I would like to say - and we talked about this at the Council of Foreign Ministers of the European Union - that this is not the time to try to identify precise causes and or to analyse how things evolved the way they did. The President of Russia has given me the Russian perspective, and now the time has come to draw the appropriate conclusions. For my part, I said that, even given the description of how this situation developed … I considered and I still consider Russia’s response to have been disproportionate. Therefore I very strongly insist that the six principles plan be implemented as extensively as possible, in order to ensure that Russian troops withdraw from Georgian territory, and I have made this clear. We refer to it as the ‘heart of Georgian territory’ so that they will leave it. This is one of the principles that must now be implemented as soon as possible. I think that in such complex conflicts the blame is very rarely all on one side. And I say now to both sides that it only very rarely that one side is not to blame at all. Now we need to move on.

QUESTION: My question is for you, Mr President.

Most people in the West do not share Russia's interpretation of this conflict. Does it worry you that this might lead to a long-term worsening in Russia's relations with the USA and the European Union?

Mrs Federal Chancellor, are you worried that this conflict and the way it has developed make a rethinking of Russian-German and even Russian-European relations necessary?

And a question for both leaders: did you discuss this subject?

Thank you.

DMITRY MEDVEDEV: All we did was discuss the problems and consequences arising from this conflict.

As far as our interpretation goes, I can put everything in very clear terms. Of course we do not want any worsening in relations, either long term or short term. On the contrary, we want full-fledged development of relations with the European Union and with individual European countries, and also with the United States of America and other countries.

We live in a very fragile world and it is very clear that a global worsening in the international situation only plays into the hands of the most reactionary forces. You would have to be blind and unaware of what is going on not to understand this. Our position is that common sense must prevail and that our partners need to be very clear and aware about what has happened and what the consequences are, and not look for a single guilty party and all the more so not lay all the blame on the Russian Federation, but do everything possible to minimise the consequences of these tragic events.

For our part, we are ready to work with everyone openly and in goodwill, and we do not want to damage our relations with anyone. But at the same time, we will continue to carry out our peacekeeping mandate, and if anyone continues to attack our citizens and our peacekeepers, of course we will respond just as we responded on this occasion, and there should be no doubt about this.

ANGELA MERKEL: Of course, events have changed our agenda. Of course there’s no question about that. Today we would have talked about entirely different topics, if it were not for this conflict. The same thing is happening in the European Union, and it will be the same in regard to NATO and with other bodies. That means that finding a solution to this conflict has to be the subject of our discussions. I’ve made some critical remarks on this subject. But that does not mean that on the basis of the general principles, which of course must continue to work, we will not go on to converse about other things or to discuss other topics. Our countries are too interdependent on each other for that. All I want to say now is that it is important that the principles be respected. I talked about territorial integrity, and I can just as well talk about the principle that in dealing with Georgia one is dealing with a chosen, elected leadership, with whom you have to negotiate, with whom you need to stay in contact even in the most difficult situations and times. In addition to that, there’s the fact that we must respect decisions taken by countries that are free and that, again with regard to the possibility of joining NATO, can make whatever decisions they like about whom they want to cooperate with. If these are the principles and we make sure that they are honoured, then we can obviously talk about more than this conflict, and we will talk about other topics, putting them on the agenda in the same way that we have done before. And it is in this spirit that we should cooperate with each other, based on common principles and striving to resolve all issues relating to both our sides.

For example, I think that the European Union with the visit by Nicolas Sarkozy and the development of this six principle plan, taking into account what the U.S. Secretary of State also contributes today in her visit to Tbilisi - all this suggests that our cooperation will continue.

QUESTION: Concerning relations between Russia and the West, I have a question for both leaders. Yesterday evening, the USA and Poland signed an agreement on deploying elements of the US missile defence system on Polish territory, plus, if I am correct, air defence missiles will also be deployed in addition.

My question for Dmitry Anatolyevich is what is your reaction to this? Russian military officials said today that this shows that the missile defence plans are directed against Russia and not against Iran. Do you share this point of view?

And I put the same question to the Federal Chancellor. Do you think that the signature of this agreement could change the situation?

Thank you.

DMITRY MEDVEDEV: The Russian military officials are right. This decision demonstrates very clearly what we have been talking about of late, that the deployment of new missile defence systems in Europe is directed against the Russian Federation. The moment has been chosen accordingly. The stories about this all being to deter rogue states do not hold water.

What has taken place is clear and there is nothing I can comment on. This is sad for Europe, sad for everyone living on this densely populated continent, but it is not dramatic. We will continue to work on this matter and we are ready to discuss all of these issues with everyone involved. But the latest decision has done nothing to calm the situation, of course.

ANGELA MERKEL: In my view, this agreement is not aimed at Russia but is rather an example of anti-ballistic missile defence, of a system of anti-ballistic missile defence that will protect against countries such as Iran. We will continue to advocate that these negotiations should not be interrupted and convince Russia of this and convince it to engage in this process as well.

We made progress on this subject at one point. When I think about our meeting in Heiligendamm last year, we talked about how to include Russia in this, because our analysis of threats emanating from Iran and other countries and Russia’s analysis were so similar, in the sense that we all agree on these things. And what has just happened should not prevent us from taking these negotiations further. I am therefore optimistic that we will continue our negotiations in the near future.

DMITRY MEDVEDEV: I would just like to add a couple of words, not continuing on what the Federal Chancellor said but rather addressed to all the journalists present today.

You know that the tragedy that took place had us all glued to the TV screens and to other media sources and the Internet. I, like any ordinary person, also got some of my information from the media, as well as from the channels I have as President. The information picture that emerged leads me to ask three questions I would like you to reflect on.

First, who started the military operations in South Ossetia? Was it the peacekeepers, the Russian troops, or was it the Georgian army? If you look at what is shown on television the answer is not clear, but we know the answer to this question.

Second, did the international community want this aggression to have an outcome that would have meant the end to the existence of Ossetians in South Ossetia and Abkhazians in Abkhazia? Yes or no?

And third, do we consider what happened to be a humanitarian disaster, yes or no? Or is this solely the affair of the Ossetians themselves and the Russian Federation?

If we answer these questions for ourselves a lot will become much clearer.

Thank you.