Medvedev Reaches Out to Obama

EXCLUSIVE INTERVIEW – The head of the Russian state is ready to abandon its decision to deploy nuclear weapons in Kaliningrad if the new U.S. president waives establishment of a missile shield in Poland.

LE FIGARO. – Mr. President, you grant the Figaro your first interview with foreign press since the election of Barack Obama to the presidency of the United States. You threatened to deploy missiles in Kaliningrad. Didn’t you put your relationship with the new U.S. president in a confrontational mode?

Dmitri Medvedev. – I want to say that my intervention on November 5 before Parliament is not linked to elections in the United States or to specific international events. This is a message primarily for internal use. The decision of the current U.S. administration to deploy a missile defense system without obtaining the consent of Europe or its partners in NATO is a real problem. We have repeatedly asked specific questions to our American partners: What good is this system for you? What does it entail? Will it be effective? We have not received a response. Better still, we have made proposals on a system of global security, we offered to use our radar systems and systems of our closest allies such as Azerbaijan, without being heard. We can’t help but react to the unilateral deployment of missiles and radars.

But we are ready to abandon this decision to deploy missiles in Kaliningrad if the new American administration, after analyzing the usefulness of the system to respond to “rogue states,” decided to abandon its anti-missile system. The first reaction of the United States shows that the new administration reflects that. We are ready to negotiate on a “zero option”. We are ready to consider a comprehensive security system with the United States, the countries of the European Union and the Russian Federation.

As for my personal relations with President-elect Barack Obama, I can say that I had a good interview on the phone with him. We hope to create a frank and honest relationship and resolve with the new American administration problems that we have failed to settle with the current Administration.

The new U.S. president has a very high level of confidence. He was elected during a very complicated time and I wish him much luck in the exercise of his functions.

LE FIGARO. – Will you have the opportunity to meet Barack Obama on the sidelines of the G20 meeting this weekend in Washington?

Dmitri Medvedev. – It is a matter of internal American interest. For the Americans to decide whether the president-elect to participate in the meeting. In any case, we agreed to meet without delay.

LE FIGARO. – Tomorrow, you will be in Nice for a summit Russia-European Union. Some members are still concerned about maintaining Russian troops in South Ossetia and Abkhazia more important than before August 7. Will you reduce these numbers?

Dmitri Medvedev. – No text, including our agreement with President Sarkozy, regulates our troops. When it was about unblocking the situation, we were talking about the withdrawal of our peacekeeping forces. But this step is completed. Now, the number and location of military bases are defined by bilateral cooperation agreements signed by Russia with these two countries, Abkhazia and South Ossetia. That in order to preserve the lives of inhabitants and to avoid a humanitarian catastrophe. What justifies a certain size.

LE FIGARO. – Is the independence of Abkhazia and South Ossetia irreversible?

Dmitri Medvedev. – Our decision to recognize the independence of South Ossetia and Abkhazia is irreversible. From the standpoint of international law, these two entities exist.

LE FIGARO. – President Sarkozy has convinced his European partners to resume negotiations to establish a strategic partnership between the EU and Russia. What do you expect?

Dmitri Medvedev. – I would like to pay tribute to the efforts of President Sarkozy to strengthen relations between the EU and Russia in all fields. We need mutual investments. Europe is the largest consumer of Russian energy, we are big buyers of technology and European products. Only with France, our trade amounted to $16 billion per year and growing. We need a solid foundation for our relationship and this is the subject of this new agreement. Russia has been, remains and will remain an integral part of Europe. Our interest is to have relations as close as possible.

LE FIGARO. – You are participating this weekend at the Washington summit on the crisis. Are you going to Washington with specific proposals?

Dmitri Medvedev. – Not only will I come up with proposals but I already sent them to President Sarkozy, Prime Minister Berlusconi, to Chancellor Merkel, Prime Minister Brown. It’s no secret we share the same vision of the origins and nature of the crisis. We need to find lasting solutions to stabilize the financial system and its reform. How to minimize the damage of the current crisis? How to avoid a repetition of this crisis? We must find answers to these two key issues.

The new global financial architecture must first be more transparent, more predictable. We must lay the foundations for a new Bretton Woods institution including new international credit, a new accounting system and a new system of risk insurance. We proposed the idea of an early warning system for risk, which must be taken into account by all countries.

LE FIGARO. – Russia is not immune to the global economic downturn. Are you ready for a massive revival comparable to that which was announced by China?

Dmitri Medvedev. – It is a major challenge. All the country’s leaders are primarily responsible for minimizing the consequences of this global crisis. We have already adopted a series of important measures, particularly in the banking sector we have increased liquidity, and the productive sector. We continue to monitor the situation very carefully, and decisions of our European partners and the Chinese. However, although it is a global crisis, there is no universal solution, and each economy is different.

LE FIGARO. – Could you be forced to nationalize the banks, once a part of the money you inject from abroad?

Dmitri Medvedev. – There is a flight of capital abroad. Nevertheless, nationalization is not the solution. We must safeguard the bank’s key system, those who provide financial movement in the country. We must also protect the savings of citizens that are guaranteed by the state. If necessary, we can take measures such as equity participation by the state, as has been done successfully in the United States or Great Britain. But even if part of the capital of banks is transferred to the state, it must be provisional. These shares will be sold on the market. I said in my message to Parliament that we do not need a state economy. We need an efficient economy, a market economy based on private property.

LE FIGARO. – The sharp drop in oil prices will weigh heavily on the budget of Russia. Do you imagine that the price of oil could rise quickly?

Dmitri Medvedev. – The decreases courses as speculation increases destabilize the situation. Of course, we can not rejoice when prices plunge below a threshold considered reasonable by all oil-producing countries. But our budget is well protected against this decline thanks to our reserve fund that will maintain social and economic spending. In the long term, I am sure that the trend in oil prices will be upward. In the immediate future, nobody can say. Economic science is reduced to being transformed into art.