WASHINGTON (MNI) – The following is the second of three sections of
the White House transcript of the remarks of President Obama and French
President Sarkozy late Tuesday:

PRESIDENT SARKOZY: (As translated.) Thank you, Mr. President.
Thank you for your invitation. I think that we can say — I stand to be
corrected by Bernard Kouchner and Christine Lagarde — but I think we
can say that rarely in the history of our two countries has the
community of views been so identical between the United States of
America and France.

To wit, one example, which is that France would not be stepping
next year into the presidency of the G20 had the United States of
America not supported France for this presidency. Now, there are the
words, there are the statements, and then there are the facts, the acts,
and that is a fact.

Now, I will not repeat what President Obama so eloquently said. On
Afghanistan, we support President Obamas strategy. We cannot afford to
lose — not for us, not for ourselves, but for Afghanistan and for the
people of Afghanistan, who are entitled to live in freedom. Of course
the road is arduous. Of course nothing can be anticipated. And of
course we are so sorrowful for the loss of young lives. But we have to
have the courage to go to the end of our strategy and explain that there
is no alternative strategy. Defeat would be too high a price for the
security of Americans, the French, and Europeans. By fighting in
Afghanistan, what we are fighting for is world security, quite simply.

Now, on Iran, I am very satisfied with what President Obama has
said. The time has come to take decisions. Iran cannot continue its
mad race. Now, we dont want to punish Iran, which deserves better than
what it has by way of leadership today, and therefore fully support in
order to get stronger, tougher sanctions at the Security Council and
take the necessary decisions is what you have. I have said to President
Obama that with Angela Merkel and Gordon Brown we will make all
necessary efforts to ensure that Europe as a whole engages in the
sanction regime.

On the Middle East, its excellent news to hear that the United States are thus engaged. Of course peace in the Middle East is the — is something which concerns primarily the Israelis and the Palestinians. However, the absence of peace in the Middle East is a problem for all of us, because what it does is keep feeding terrorism all over the world. And I wish to express my solidarity vis–vis President Obama in condemning the settlement process. Everybody knows how engaged and committed I am vis–vis Israels security, but the settlement process achieves nothing and contributes in no way to Israels safety and security. There comes a time when you have to take initiatives in favor of peace.

Now, on financial regulation, again, its great news for the world
to hear that the United States is availing itself of rules, adopting
rules so that we not go back to what we have already experienced. And
during the French presidency of the G20, Tim Geithner, Christine Lagarde
are going to be working hand-in-glove in order to go even further in
regulating world capitalism, and in particular, raising the issue of a
new world international monetary order.

On all these subjects theres much convergence of views. And of
course I want to say to President Obama how glad we were for him and for
the USA to hear of the successful passing of the health care reform.

And insofar as the President has revealed a secret — namely, where
I had lunch today — I should say that I have a good friend in
Washington who had actually recommended that restaurant. When I walked
in I saw a huge photograph of President Obama. And Im afraid that when
you go back to that restaurant you may see a smaller photograph of the
French President. (Laughter.)

PRESIDENT OBAMA: Weve got time for a couple of questions. Im
going to call on Ben Feller. There you are, Ben — AP.

Q Thank you, sir. Thank you for your patience. President
Obama, youve talked about the importance of having consequences for
Iran over its nuclear program, but is there ever a real deadline? What
is your specific timeline for U.N. sanctions on Iran? And is it one
that the American people can believe in?

PRESIDENT OBAMA: Well —

Q Im sorry, sir, I just wanted to ask President Sarkozy, you
said yesterday in New York that the world needs an open America, an
America that listens. Im wondering if you can elaborate; specifically
if you think President Obama is open to the world and is listening to
you.

PRESIDENT OBAMA: Well, let me answer the second question, even
though that was to Nicolas. I listen to Nicolas all the time. I cant
stop listening to him. (Laughter.)

On Iran, we came in with a very clear approach and a very clear
strategy, and it was an open book to the world. We said we would engage
Iran and give them an opportunity to take the right path, a path that
would lead to prosperity and opportunity for their people and a peaceful
region, and one in which they would allow themselves to become a
full-fledged member of the community of nations. The alternative path
was further isolation and further consequences.

We mobilized the international community around this approach,
including partners like Russia that in the past might have been more
hesitant to take a firmer stance on Irans nuclear program. What we
said, though, was that there was going to be a time limit to it and that
if we had not seen progress by the end of the year, it was time for us
to move forward on that sanctions track.

My hope is that we are going to get this done this spring. So Im
not interested in waiting months for a sanctions regime to be in place;
Im interested in seeing that regime in place in weeks. And we are
working diligently with our international partners, emphasizing to them
that, as Nicolas said, this is not simply an issue of trying to isolate
Iran; it has enormous implications for the safety and the security of
the entire region. We dont want to see a nuclear arms race in the
Middle East.

A conflict in the Middle East as a consequence of Irans actions
could have a huge destabilizing effect in terms of the world economy at
a time when its just coming out of a very deep recession.

The long-term consequences of a nuclear-armed Iran are
unacceptable. And so Nicolas, myself and others agree that we have
engaged; the door remains open if the Iranians choose to walk through
it. But they understand very clearly what the terms of a diplomatic
solution would be. And in the interim we are going to move forcefully
on a U.N. sanctions regime.

Now, do we have unanimity in the international community? Not yet.
And that’s something that we have to work on. We think that we are in a
much stronger position to get robust sanctions now than we were a year
ago prior to us initiating our strategy.

But its still difficult, partly because, lets be honest, Iran is
a oil producer and there are a lot of countries around the world that,
regardless of Irans offenses, are thinking that their commercial
interests are more important to them than these long-term geopolitical
interests. And so we have to continue to apply pressure not just on
Iran but we have to make sure that we are communicating very clearly
that this is very important to the United States.

Q You can get unanimity within weeks?

PRESIDENT OBAMA: We think that we can get sanctions within weeks.

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** Market News International Washington Bureau: 202-371-2121 **

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