MS. PERINO: Good afternoon, everyone. I have the pleasure of bringing with me today the National Security Advisor to the President, Steve Hadley. He will spend some time with you, talking about the visit and the meeting. The President and Chancellor Merkel gave you pretty much the readout on the meetings, and Steve will be able to flesh that out a little bit, provide some background on what was definitely a successful meeting and an enjoyable visit.
And so I will introduce Steve. He'll take some questions, and then we'll all have the Saturday afternoon to ourselves.
MR. HADLEY: Good afternoon. You heard from the Chancellor and the President what they talked about. I can give you a little bit of color. These are two people who are very comfortable with one another. They obviously as you could tell from the conversation and their readout, they talked about a range of issues. We are working very closely with Germany on a whole host of things, and as you know, these are two people who, every other week, are talking with each other via secure video -- again, talking about the range of issues. So at this point, they spent a lot of time together. They had talked about a full range of issues. We are very closely aligned with them and coordinated on what we're doing.
They are also two politicians. The dinner last night was supposed to go until 8:00 p.m.; I think we broke up after 9:00 p.m., left the dinner table, sat around a circle of chairs, talked about history. The Chancellor talked, for example, about Conrad Adenaur and his contribution to Germany, and the kinds of arrangements he made in the postwar Germany period, and put in place many of the institutions today. They talked about the difference in our political systems; interesting discussion of the role of the lender in the German system versus the role of the states in ours. That kind of informal conversation continued over lunch today.
So I think the bottom line are these are two people who are very comfortable with one another, at this point know each other well, know their positions on issues well, and are both people who are very results-oriented. And the discussion is always, what can we do together to achieve a common result. So it was a very good and successful meeting. I think it sort of capped a week of very constructive engagements with the Prime Minister of Turkey, the President of France, and now the Chancellor of Germany. And it shows, I think, how closely the United States is working with Europe to solve a whole host of problems.
And I think, by way of introduction, that's really all I have for you. And I'd be delighted to answer any questions that you might have.
Michael.
Q Can you just give us a bit of the discussion of what the conversation about Iran was focused on? And did Chancellor Merkel seek any kind of assurances from President Bush just on the use of military force? I know that President Bush has said he wants diplomatic approach first. That's -- he's not taken it off the table. We didn't really hear exactly what Chancellor thought about that as an option, but did she -- did that come up in the discussion?
MR. HADLEY: It didn't explicitly because they have talked a lot about Iran and share a common framework, which is it's a very serious issue; the prospect of a nuclear-armed Iran is very destabilizing to the Middle East, and we need to be turning up the diplomacy in order to try and achieve a result.
But I thought what was interesting about the Chancellor's comments publicly, which echoed what she said in private, is her belief that we needed to increase the pressure; that she was -- clearly indicated that she was open to the possibility of a third Security Council resolution, depending on what we hear from the conversations with Solana, what we hear with the IAEA. She talked about needing to be open to a new Security Council resolution. She talked about financial pressure that could be placed on Iran. She made a comment, I think -- and you can check the transcript -- that German companies would have to look at their relations with Iran and opened the possibility that they might review those relations.
So there's clearly a recognition that we may need to put more pressure on the Iranian regime, so that they would change a set of policies that are having the effect of isolating the Iranian people, and that at the same time keeping open the -- as we have from the very beginning -- the option of negotiating a successful outcome to this problem, if the Iranians will suspend the enrichment and come to the negotiating table.
And as we've said many times, we're prepared to join; that the problem is not a civilian nuclear program for Iran, the problem is a program that seems designed to achieve a nuclear weapon capability. That's the problem; and that once that problem is removed, then there is a positive way forward for Iran on the table that involves easing pressure on the regime and also a civilian nuclear program.
So they are way far down the road in terms of having a common understanding of -- and a common approach to this problem and a common understanding of what needs to be done.
Deb.
Q Did they talk about any new ways to bring Russia and China on board? And currently, what's the real likelihood of that? What's the reality of that?
MR. HADLEY: They did talk about, as the Chancellor did in her comments, and I think the President, as well, to the press conversations, they did talk about Russia and China. Just looking at some notes here. One of the things I guess people need to understand is that Russia has been pretty good on the issue of Iran. They understand the problem, they have been active in the diplomacy. You may remember nine months to a year ago, they had a very active engagement going on with Iran, trying to get Iran to accept the notion of suspending an enrichment program and being willing to participate with Russia in an international consortium in Russia that would ensure an adequate fuel supply for their civil nuclear power.
President Putin was recently in Tehran, and he gave a very good message, very consistent with what we've said, the Germans, and others have said, about Iran needing to recognize that it's isolating itself internationally, and needs to give up these programs, and particularly suspend the enrichment, so we can come to the negotiating table.
I think the issues with respect to Russia are tactical issues: at what point do you look at a third resolution; exactly how tough that resolution should be, so that you are both pressing Iran, but also leaving the door open for some solution? And this is, I think, a tactical issue between the two.
China needs to play a more responsible role on Iran, needs to recognize that China is going to be very dependent in the decades ahead on Middle East oil, and therefore, China, for its own development and its own purposes, is going to need a stable Middle East; and that an Iran armed with nuclear weapons is not a prescription for stability in the Middle East.
And that's one of the things I think we need to do with China, is -- China, which I think views this in some sense as a tactical issue and has a very resource prism through which they look at this problem -- is to say to China and get China to understand that strategically, over the long-term, it has an interest, as do the rest of us, in a stable Middle East. And that requires them to join with the rest of the international community and put pressure on Iran. That's the kind of discussion that we need to have with China, and the two leaders talked about opportunities each of them has to make that point to Chinese leadership.
Q I have the quote in front of me about what you said about the business ties. You said, "We then also said that Germany needs to look somewhat closer at the existing business ties with Iran." Was your understanding that she would look at that if a third round of sanctions failed? Or would it be way down the road?
MR. HADLEY: Well, some of that is happening now. As you know and have reported, there have been steps taken by German banks, for example, to step away from Iran as the awareness has become more widespread that Iran is using banks, and sometimes its relationships with European banks, to basically launder funds that are used to support terror or for proliferation. So there already have been steps that have been taken, and you've reported on them. I think what she was saying is we may have -- that Germany may have to do more and call on its companies to do more in the future.
Q But there was no specific time line tied to that or --
MR. HADLEY: Well, there is a time line in this sense -- I mean, there is an understanding among the P5-plus-1, the so-called -- those key countries that have been conducting the negotiations with Iran and have been, in some sense, a contact group for dealing with Iran -- that if, in the November-December time frame, there is not progress on the negotiations conducted with Larijani, or negotiation -- progress on the dialogue with the IAEA, then the P-5-plus-1, which is the Permanent 5 members -- the five permanent members of the Security Council plus Germany -- would look at a third resolution. That has been agreed.
So the next step in the timing is actually established, and what we are waiting for is to get a good picture of what's going to happen in terms of the IAEA discussions and the discussions that Solana is having with the Iranians.
Q -- giving up the business ties would occur in parallel to considerations of sanctions?
MR. HADLEY: Yes, I think that's a fair statement. She said that the -- from the very beginning, we've kind of had a two-track process here; one is working formally through the Security Council with formal Security Council resolutions, and then secondly, things that companies and banks have done outside of, and in parallel with actions taken pursuant to U.N. Security Council resolution. That's where we've been in the past; I think that's where we will continue going forward.
Q To what extent at the discussions themselves was this idea of the German companies reviewing their transactions with Iran a topic? And did she volunteer to do this, or did the President seek her further cooperation on this?
MR. HADLEY: This is something that's been going on for some time. There's been a dialogue between the United States and Germany for some time, both on banks and companies. Again, we're pretty knit up with the Germans on this. This is an ongoing discussion. The President and the Chancellor have talked about it before; they will be talking about it again. And I think this is something the Chancellor -- my recollection is the Chancellor and the President talked about before. I don't know which one raised it, but it's a very familiar subject, sort of always on the agenda when the two of them talk about Iran, and Iran is pretty much always on the agenda.
Q How much was this an issue at this particular get-together, though?
MR. HADLEY: It's not an issue of disagreement. It's an issue and agreement.
Q I'm just asking, how much it was on the table?
MR. HADLEY: It's basically, as they go through the list of steps that the two sides, that the United States and Germany are taking together on the issue of Iran, this is one of the things that shows up on the list.
Q Is Germany still Iran's biggest trading partner?
MR. HADLEY: The data on that is changing, and I have seen people who say that actually China has now moved ahead or moving closer to Germany. And that's one of the things, of course, that if this is going to work, we need to extend the circle of countries that are participating in this process. And that's why what China does is so important and why I talked to -- I made the answer I did to Deb's question -- that China has a role to play in sending a unified signal of the international community to Iran.
Q Steve, President Musharraf said that he will step down as army chief if, and only if, he is confirmed by that country's supreme court as President. The President and other U.S. officials say that you are confident that Musharraf will step down as army chief. Does it therefore -- can we conclude logically then that you are confident that Pakistan's supreme court is going to confirm him as President?
MR. HADLEY: I don't think his statements have been as categorical as you said. You may be right; I don't read them as that. What I understand him to have said from what I have read is that he has said that he will take off the uniform before he would be sworn in as President. As you know, at this point the supreme court has not certified the results of the election. And so the issue has not arised -- arisen. But what he has said was that before he's sworn in as President, he would take off the uniform.
Q Sorry, I don't understand the difference. If he needs -- if the supreme court needs to validate his election victory, then he can be sworn in -- what's the difference between what I described and what you said?
MR. HADLEY: I don't know -- I'm telling you my understanding of the facts, which is what I'm trying to do in a careful way, as I understand them, and the sequence, as I understand it, is as I've described.
Q Also, there's an Israeli deputy prime minister who came out today and said, on the Iran nuclear situation, "The opportunity for a negotiated solution is diminishing." This is after he came to Washington to discuss -- to talk strategy on the Iran dossier with American officials. Is that a concern that the White House shares?
MR. HADLEY: Well, you know, the President was asked the issue of time lines today, and he gave you the answer that he gave. I think one of the things we've all said is, that we need to turn up the diplomacy and turn up the pressure. And there's a sense in which we need to reenergize this process. And that's one of the reasons why the President and the Chancellor talked about it fairly extensively in their private discussions, and then fairly extensively today.
Steve.
Q To follow up on that, it's been widely reported that in Germany there was opposition to the unilateral steps that the U.S. announced on sanctioning the Iranian Republic Guard and al-Quds. Did that come up specifically in the discussion? And then I have a follow-up on Kosovo if we're done with this.
MR. HADLEY: No, it did not come up. There was no -- the question was whether the -- the premise of the question was -- and I think it's just a premise, I would say it's a premise -- that there has been opposition in Europe to the announcement we made two weeks ago, about two weeks ago, of sanctioning the Quds force and the IRGC. And the question was, did that issue come up in the discussions today. It did not. I am not aware that the President has heard from any of his counterparts any criticism of that step. Quite the contrary; he's heard from a number of them -- not all, a number of them -- a sense that that was an appropriate step to take in this process of stepping up the diplomacy and stepping up the pressure on Iran.
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