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Lavrov Says BRICS Nations Gain Support in IMF Bid (Transcript)

June 2 (Bloomberg) -- Russian Foreign Minister Sergei Lavrov discusses the outlook for the leadership of the International Monetary Fund.

Lavrov , speaking yesterday in Moscow with Bloomberg’s Henry Meyer, Brad Cook and Ilya Arkhipov, also talks about bilateral relations with the U.S., Libyan leader Muammar Qaddafi and the political unrest in Syria.

(This is not a legal transcript. Bloomberg LP cannot guarantee its accuracy.)

QUESTION: Mr. Foreign Minister, I was at the G-8 Summit in France last week where Russia hijacked the official agenda with its initiative to mediate Colonel Qaddafi. What happened? Did President Obama ask President Medvedev to help NATO get out of the mess it’s in, in Libya?

LAVROV: It wasn’t the Russian initiative. It was a request, an appeal from President Sarkozy, from President Obama, from other participants. And this was not about something new us because in the past few weeks we strongly supported the mediation efforts by the African Union and by the United Nations’ Secretary General Special Envoy, Mr. Habib.

And in support of those first we had been talking to various parties. Actually, authorities from Tripoli and the people from Benghazi addressed a [peril] of request to us to be received in Moscow. And I met with the representatives of both the authorities in Tripoli, and the representative of the people in Benghazi and also with Mr. Habib, the Special Envoy of the United Nations who visited Moscow.

And when in Deauville this issue was discussed the position of Russia, who among all the participants was probably the only one keeping contacts with both Tripoli and Benghazi, the position of Russia was appreciated as allowing for further efforts to promote a cease fire and to promote a deal which would be acceptable to all mediums. Actually, from Deauville itself I talked over the phone with the Libyan Prime Minister, who called me and wanted to talk.

And I explained to him what we think about the whole thing, the G-8 countries, about the process which should be underway and should lead to a compromised solution allowing for getting out of this deadlock, stopping the war, building national reconciliation, preparing for elections and so on.

And as far as the continued contacts with the Benghazi people are concerned, the Special Envoy of the President of Russia, Mr. Margelov, would be going there very soon. And we keep open all our channels of communications, especially with the African Union. The President of South Africa, Jacob Zuma, twice talked to President Medvedev over the phone before his visit to Libya and immediately after. So I hope that the accumulated effort of all those who want to see an end to the hostilities and the beginning of the construction of a new Libya would bring results.

QUESTION: What kind of guarantees are going to have to be offered to Colonel Qaddafi to persuade him to step down, immunity from prosecution of the ICC?

LAVROV: This is the question which should not be addressed to us. It should be addressed to the Libyan people and to the coalition as far as I understand, and of course to the African Union. We are not engaged in negotiating any deals of immunity or guarantees. This is not part of our effort.

QUESTION: According to your understanding, though, what do you think the minimum that he will settle for?

LAVROV: I don’t know. I really don’t know. Each person is unique, but I can tell you without revealing too many secrets that the leaders of countries who can influence the situation are actively discussing the possibilities.

QUESTION: So there is a formula which being discussed?

LAVROV: That’s what I told you. The - there are possibilities which are being discussed.

QUESTION: Is he going to be allowed to go into exile or stay in Libya?

LAVROV: This is not what we are discussing. We are not discussing any details of whatever guarantees might be offered to him.

QUESTION: President Medvedev at his press conference at Skolkovo last month said that Russia will not back a UN resolution condemning Syria after Western powers abused Russia’s trust in the resolution over Libya that also has military action there. Prime Minister Putin, according to the White House, would have blocked that Libya resolution if he had still been president. With the benefit of hindsight, do you think that blocking that resolution might actually have been the better history?

LAVROV: I don’t know. I don’t know who in the White House told you so. The vote on the resolution 1973, when we abstained was agreed by the Russian leadership during the procedures, which exist for these purposes.

And we coordinated this position with the BRIC countries and Germany joined us, which was an important signal that not everything in that resolution was okay. We shared the goal of declaring a no-fly zone, which meant, at least it meant in Iraq when the no-fly zone of Iraq was declared, that the Air Force cannot use their space to attack civilian targets. And it’s only the war planes of the regime up in the air, which were the legitimate targets.

That’s why we wanted, while having supported the no-fly zone goal we wanted the paragraph which described the means to achieve this goal to be as specific as necessary. And the size-less description of all means necessary, anyone who wants to do it can do this and can do whatever he or she pleases, it’s really going very far beyond the declared goal and the purposes of the resolution, goes very far beyond the original request of the Arab League.

So from now on, and we informed our colleagues in the Security Council already, from now on whenever somebody would like to get authorization to use force to achieve a shared goal by all of us, we would have to specify in the resolution who this somebody is, who is going to use this authorization, what are the rules of the engagement and what are the limits of the use of force. This is a generic position. It is not just for a Syrian case or for any other case. It’s for the future. This would be our very firm approach.

As for Syria, there is a resolution of the United Nations Human Rights Council, which authorized investigation. And this should be followed on.

As for the Security Council engagement in Syrian case, we don’t think it’s necessary at all. First, the situation does not present a threat to international peace and security, the issues which are on the agenda with the Security Council.

Second, Syria is a very important country in the Middle East and destabilizing Syria would have repercussions far beyond its borders. So it could do the opposite effect. We don’t see any threat to international peace and security now, but if we interfere with the Syrian domestic matters there might be quite considerable consequences, at least regionally.

And we strongly support the need for reform in Syria. President Medvedev talked to President al-Assad twice, once in April and the second time just a few days ago. And we are gratified that our appeals have been heard because we encourage strongly President al-Assad to start implementing in practice the reforms which he announced.

And recently he published a draft of a new constitution. He declared amnesty for political prisoners and I think this should calm down the situation and would encourage their position to sit down and to start talking about implementation of those reforms.

It is not in the interest of anyone to send messages to their position in Syria or elsewhere that if you reject all reasonable offers we will come and help you, as we do in Libya. It would be a very wrong and very dangerous message, so I hope the Libyan case would remain unique.

QUESTION: But some people who are say outside the palace may be encouraging the protests in Syria in order to remove al-Assad and reduce Iranian influence in the region. What do you think about that?

LAVROV: I just directly said that this is a very wrong posture to give their position signals that if they persist in their refusal to negotiate then they will get foreign military help. It’s a very dangerous position.

QUESTION: Which countries do you have in mind that may be -

LAVROV: Any, any. It’s unacceptable for any country to plan some type of action like this.

QUESTION: Russia hosted Palestinian factions recently. There are talks going on, on the formation of an interim unity government. How is that going and do you know which will be the main figures in this new government?

LAVROV: No. Obviously it’s for the Palestinians to decide. And before the Palestinian factions came here the indication of the Institute of Oriental Studies on the Russian Academy of Sciences of course the leaders of all Palestinian factions signed a deal in Cairo, which we strongly supported. And I hope this would now be translated into practical steps. At least that’s what we told our Palestinian interlocutors when they came to this room, actually, after their two or three-day conference in the Academy of Sciences.

It is very important to stick to the understanding which they reached that the government would be technical government composed of technocrats, not politicians, not of people who have some [budge] affiliations, and that this government would have very limited mandate, mostly to prepare for the elections and do on day-to-day things providing services to the people. So the elections I hope would be held soon.

It is up to the Palestinians to agree on the dates and the schedule. And I hope that after the election the Palestinians would have a parliament and the president who would be firmly based in their policies on the platform of the Palestinian Liberation Organization and on the Arab Peace Initiative.

This was a very important element of our discussions with them and those factions accepted this approach, which is quite important because PLO platform recognizes Israel and recognizes all existing agreements. And the Arab Peace Initiative modelizes (ph) behind this position the entire Arab world.

QUESTION: Do you think that Mr. Fayyad and Mr. Hania will have a role in this techno kind of -?

LAVROV: Not for me to decide on this, as I said.

QUESTION: Let’s go to Iran now. It has been rather pushed out of the limelight by the events elsewhere in the Middle East over the last six months. Are you concerned about the impasse in talks over Iran’s nuclear program? And would Russia soften its opposition to additional UN sanctions against Iran if there is no progress made in these talks?

LAVROV: Well, we - normally we try to stick accurately to the agreed positions with our partners. The reposition of the Three plus Three group, or Five plus One group, whatever you prefer, was that we use the deal track approach negotiations and international pressure, the international pressure being conceived for the sole purpose to encourage Iran to negotiate, and the Security Council to be used in support of IAEA to sanction in a very targeted way those parts of the Iranian government structure and those persons in Iran who are directly involved in the nuclear program, just to send the message and to exert pressure.

So with the adoption of a resolution in June last year all considerable areas having anything to do with the nuclear program have been targeted already. So any new sanctions would have nothing to do with the original purpose of the exercise and would in fact be aimed at suffocating the Iranian economy.

Consideration number two, when we agreed collectively to go to the Security Council and to endorse sanctions in support of IAEA demands to Iran, we have been repeatedly saying that we must stick together, and the Americans and the Europeans were telling us the same. And while we painfully negotiated the last resolution, it touches upon quite a number of areas which are of economic interest to Russia, to China, to some other countries, so it was not easy to negotiate.

So and we did eventually reach a deal. Our friends in the United States and in Europe immediately added their own unilateral packages, in fact introducing those very sanctions which during the negotiations in the Security Council they agreed to drop. It’s not a very decent approach to negotiating a collective position.

So with all these considerations we don’t see any possibility for additional international universal sanctions on Iran, but your first question, whether we are concerned with the lack of negotiating momentum, yes, we are. And we have been encouraging our partners in Three plus Three group not to make this pause too long and not to forget about the need to come back to the negotiating table.

At the beginning of the year there were two meetings between Three plus Three, headed by Cathy Ashton, and Iranian delegation which did not produce any practical result, but which were important to understand that unless we become creative we would not be able to move. After all with North Korea the Americans show quite a lot of creativity and similar intellectual effort could be made on Iran, Israel.

Last November we suggested to our partners in Three plus Three that the basic position paper, which we gave to Iran I think a couple of years ago, could be additioned by some kind of a road map, which would describe a step-by-step approach and the logic, which I would call action for action. Iran does something specific, for example resuming the application of additional protocol to the safeguards agreement with IAEA, and we say - agree not to introduce any new unilateral sanctions.

And then when Iran does something else, expanding the access for IAEA to the places where the agency want to go, then we suspend sanctions, and so on and so forth. The Three plus Three group accepted the logic of step by step and this reciprocity approach, but we have to be specific and show to Iran that if it cooperates, if it answers satisfactorily the IAEA demands, then it should see the light at the end of the road.

QUESTION: Russia’s assessment of how soon Iran could acquire a nuclear bomb.

LAVROV: We don’t have any proof that Iran has taken a political decision to produce a bomb. And whatever information IAEA has does not support the conclusion that Iran already is making a bomb. IAEA has access to all sites which Iran legally must show to the inspectors.

Iran does not apply, as I said, additional protocol and modified Code 3.1, which are not obligatory, but which I think are very important, especially for Iran because apart from its rights under the Non-Proliferation Treaty Iran has quite important obligations, obligations related to the need to ensure exclusively peaceful nature of nuclear program, and there are some questions and the international community wants to clarify.

So the IAEA resolutions, the Security Council resolutions are aimed exactly at this and they must be implemented, but Iran must see the light at the end of the tunnel, as I said. And the conclusions of the agency would be the crucial criteria. So far, as I said, they cannot confirm exclusively a peaceful nature of the Iranian nuclear program, but they cannot conclude that the Iranian nuclear program has a military vein much (ph). So it’s a process which can only be successful if we account, not only use sanctions and threats, but on negotiations, as any other situation in the world actually.

QUESTION: Prime Minister Putin has been invited President Obama to visit the United States this autumn. What is he going to discuss there?

LAVROV: Well, I think it was discussed during Vice President Biden visit. And whenever Russian and American presidents, Russian Prime Minister and American leadership meet they discuss the entire range of issues on the bilateral, and regional and international agenda. So if I start really explaining it would take a couple of hours.

QUESTION: Do we know when he is coming?

LAVROV: Not to my knowledge.

QUESTION: But are you working on his agenda?

LAVROV: Well, this was mentioned, but I never heard any follow up to this. This would have to be handled by respective protocol services.

QUESTION: President Medvedev said last week in Deauville that he wants BRICs to have the number two job at the IMF. If Mrs. Lagarde replaces Dominique Strauss-Kahn, has this agreement now been reached with the US and the EU? Do you have any candidates for this position? Brazil is reportedly interested in filling that job.

LAVROV: It’s a matter of principle. The IMF is under a continued reform process. This reform is not yet finished. The entire thrust of the reform is to give more voice to the countries, to the emerging economies who accumulate more financial and economic power. And this fact must reflect it in the IMF structure, including the structure of the IMF Secretariat. And for the BRICs countries to have a position of a deputy executive director I think is a very logical request, and it was considered as very legitimate by all the participants of the G-8 with whom President Medvedev discussed this possibility.

QUESTION: But no specific candidate in mind at the moment.

LAVROV: Not to my knowledge. There is a candidate we should mention. There is - there are not other candidates, but we want as a first step to have a decision in principle because the position we talk about it must be created. It’s a new position. We don’t want to fire any existing deputy executive directors.

QUESTION: Will Mrs. Lagarde serve her term only the end of Dominique Strauss-Kahn’s original term, or will she get the full term as, well, Brazil is with (inaudible) condition?

LAVROV: Look, look, look. I don’t run this show in the Russian, on the Russian side on international. I just don’t know how this would be handled.

QUESTION: Prime Minister Putin has described the circumstances surrounding Mr. Strauss-Kahn’s arrest as mindboggling. And he said he doubted the official version of events. More than half of French people think that Mr. Strauss-Kahn was a victim of some elaborate setup. What’s your view?

LAVROV: Frankly, I don’t have any position which would be firm. It’s a very strange situation whatever is the angle you look at it. And I just read it as I read it, not as somebody who would be judging what actually happened.

QUESTION: So you don’t think that there is something fishy about -

LAVROV: I answered your question.

QUESTION: Very good. Mikhail Khodorkovsky is asking to be freed on parole. Foreign investors say that such a step would restore their faith in the rule of law in Russia and would help to persuade them to put their money here. Do you sympathize at all with that point of view?

LAVROV: Well, I can only repeat what was stated very often that the entire case must be dealt with on the basis of the Russian legal system. Whatever you think of the system, we don’t have any other. We see its deficiencies. The President addresses this issue regularly and undertakes initiative to make it better. It will take time.

But any case like Mr. Khodorkovsky case must get addressed only on the basis of the Russian legal system, which provides for the possibility, by the way, for anyone who is not satisfied to go to the European Court on Human Rights, which recently ruled in favor of Mr. Khodorkovsky request for the compensation of more of difficulties, whatever is the term, and for the - some court expenses, but which clearly stated that they don’t see any reason to call it a political case.

QUESTION: Is that a vindication for the Russian legal system?

LAVROV: It’s a verdict of the European Court on Human Rights.

QUESTION: How much do you think Belarus may need to borrow from the Eurasian Economic Community -?


QUESTION: Belarus, to stabilize its economy? Initially Russia was talking about a figure of $3 billion, but there is now a figure of $9 billion being floated out there.

LAVROV: Well, the answer to the question how much Belarus should borrow is a subject in negotiations between Belarus and other members of the Eurasian Community Anti-Crisis Fund.

QUESTION: What’s holding up an agreement on a bailout package and how soon do you think that could be reached?

LAVROV: As soon as an agreement is reached, as soon as all parties are satisfied, -

QUESTION: You’re not -

LAVROV: - like in any other negotiations on a bailout, a credit.

QUESTION: You are not aware of any particular issues holding up the negotiations?

LAVROV: No, no. If you think that I am running all imaginable issues with our international partners then you better read the paper which said - which describes the functions of the Russian Foreign Ministry.

QUESTION: U.K. Prime Minister David Cameron is due in Moscow in September. It’s the first visit by a U.K. head of government since the assassination of Alexander Litvinenko in 2006. How significant is it for bilateral relations?

LAVROV: I think it’s a first visit for a much longer period. Any visit of a leader of a country with whom we have relations and this while we want to develop these relations is important. President Medvedev invited Prime Minister Cameron and we agreed that this visit would take place in September.

We will discuss the further increase of our trade and of mutual investments, which are booming. U.K. is the - one of the leading partners of Russia as far as trade and investments are concerned. We will discuss our very fruitful cooperation in quite a number of international formats, including on Iran, including in the United Nations Security Council, G-8, G20, you name it.

And certainly we will discuss promotion of our cultural exchanges, which are very popular along the British subjects and in Russia. So the agenda is quite rich. And we hope that we will be also encouraging our British partners to move after the other EU members and after the United States to discuss with us a mutual facilitation of travel for our citizens.

QUESTION: Will there be a reciprocal visit? Will President Medvedev or Prime Minister Putin be traveling to the U.K. anytime soon?

LAVROV: We are very polite people and unless invited we are not really speculating on these things.

QUESTION: What’s your opinion of William Browder’s (ph) campaign over the Magnitsky case? Do you think has the potential to cast a shadow again over U.K./Russia ties?

LAVROV: Well, I don’t think the British government is very obsessed with the campaign you mentioned. So I have not noticed any serious influence on practical development of our relationship.

QUESTION: If we can return to the first issue we discussed, Libya, Mikhail Margelov, as you mentioned, is going to Benghazi shortly. President Medvedev said he will also court contacts with the Libyan leadership. Do you have any details on when and where that might happen?

LAVROV: As I mentioned to you on that very day when this was announced and dotted, I talked to the Prime Minister of Libya, Mr. Mahmudi, and conveyed to him everything what needed to be conveyed, so we don’t exclude the contacts with Tripoli people in the future, but you are becoming to go in circles, right? You are out of the questions?

QUESTION: No, no, no, no. This is -

LAVROV: Because I don’t have too much time.

QUESTION: Was at - President Obama was getting (ph) to this Russia. And he is going to make happen and say full preparation phase. And what do you expect for this visit?

LAVROV: Well, about expectations, of course I answered already. It’s a whole range of bilateral, regional and international issues. Yes, President Obama was invited to Russia. He was invited by President Medvedev when President Medvedev visited Washington last year. And we hope very much that before the end of this year this visit will take place.

I was also invited to Washington by Hillary Clinton to discuss the preparations for the Summit and we are now considering the dates, sometime in the summer for me to go. And hopefully soon we would also get some indication about the dates for President Obama’s visit.

QUESTION: Is very likely to happen. You are very hopeful.

LAVROV: Look, I feel like being stupid or unable to explain myself because every time I think I answered, you keep repeating the original question. Sorry if I was not very clear on this and previous occasions.

QUESTION: Sorry, final question. These deal to by Mistral contract from France, which was announced in W, is there going to be a technology transfer? Is that your understanding under this comment?

LAVROV: It’s not what I understand. That’s what was announced by President Sarkozy and President Medvedev.

QUESTION: What is your message to simplism (ph) reform and what is your investment-oriented message as head of the Foreign Ministry? And as we know, both the President and the Prime Minister stressed recently the importance that Foreign Ministry activity in Balkan (ph) created a more attractive investment which of Russia one side, and on another side helping Russian business to go abroad, to expand its activities.

LAVROV: Well, I think the main message is for the investors to come and see for themselves. The main message for investors is to read carefully what President Medvedev says and what he commits himself and the Russian government to by way of specific measures to improve the investment climate.

You cannot just give investors an order to come and invest. They must take the decisions on the basis of their own assessment of the situation. Come and see. Many have come already and we are very gratified that quite a number of American leading companies like Microsoft, Google, Wi Inc (ph), Cisco Systems are working in Scolkovo already or are planning to do this in very practical terms. Innovation and high-tech projects is what we want, is what we need to diversify the economy to make it less reliable on hydrocarbons and other raw materials. So that’s the main message.

Come and see and many not only come, but also tell us what they believe should be done additionally to improve the business climate. And both the President and the Prime Minister we meet with business communities from Russia, from foreign countries. And they listen to advice when advice is given on the basis of experience and when it is well motivated. So that’s the message. Come and see.



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