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EU, Russia Agree on New Partnership Talks and Financial Policy

Relations between the EU and Russia took another step towards normalization when the presidents of Russia and France agreed to continue negotiations on a "new EU-Russia agreement" in December.

French President Nicolas Sarkozy, left, shakes hand with President of the Russian Federation Dmitry Medvedev during the EU-Russia summit, in Nice, southern France, Friday, Nov. 14, 2008.

Sarkozy and Medvedev also discussed Georgia and the proposed US missile system

Russian President Dmitry Medvedev and French President Nicolas Sarkozy, whose country holds the rotating presidency of the European Union, met in Nice for four hours on Friday before setting off for a meeting in Washington with the heads of the world's most important economies.

The two leaders announced that the December 2 summit would be preceded by a round of expert meetings on November 21-22. These would lay the ground work for negotiations on a new deal to replace an earlier Partnership and Cooperation Agreement (PCA) which was signed in 1997.

Russian and EU officials held the first round of talks on the so-called "New EU-Russia Agreement," which is intended to give a legal framework to their relations in fields ranging from trade and investment to environmental protection and education, on July 4.

Despite the original PCA duration lasting ten years, the 1997 document still governs EU-Russia relations, since EU leaders decided to freeze talks on the new deal on September 1 in protest at Russia's August invasion of Georgia.

However, the EU's negotiating mandate also calls on the bloc to push for a solution to the so-called "frozen conflicts" in Georgia and Moldova which respects those countries' sovereignty and territorial integrity.

Diplomats admit that that will be a difficult challenge, given Russia's decision on August 26 to recognize the independence of the breakaway Georgian provinces of South Ossetia and Abkhazia.

Sarkozy defends his record on Georgia

French President Nicolas Sarkozy, left, looks on as Georgian President Mikhail Saakashvili, right, addresses the media, following their talks in Tbilisi, Georgia, early Wednesday, Aug. 13, 2008.

Sarkozy met with Saakashvili during the conflict

Georgia was one of the main topics during the four-hour meeting during which Sarkozy launched an impassioned defense of his efforts to end August's Russian-Georgian war, accusing his critics of not having ideas and attacking the role of Georgia's allies, including the United States.

"If you consider the strategy of some of the 'friends of Georgia' (a group including the Baltic States, Poland, and Ukraine) and the strategy of the EU, the EU one is far the better," Sarkozy said.

"Agitation in the sea close to the conflict, with trouble threatened by certain military vessels, and an anti-missile shield won't be to the benefit of Europe, Russia or anyone else," he said in a swipe at the deployment of US ships to the Black Sea during the August war and US plans to deploy a missile shield in Central Europe.

While he criticized Russia's invasion of Georgia as "disproportionate," he also stressed that it was a reaction to Georgia's attack on its breakaway provinces of South Ossetia and Abkhazia - implying that the blame for the war lies in Tbilisi.

And he condemned those detractors who said that his diplomacy had sacrificed Georgia's territorial integrity by leaving the question of the rebel provinces' status open, saying that "those who criticize don't have any better ideas."

Medvedev also accused Georgia of "aggression" in the breakaway provinces and praised Sarkozy's diplomatic efforts to bring peace.

But the two presidents disagreed on the key question of whether Russia has lived up to a six-point peace deal it signed on August 12, and over Russia's controversial recognition of the breakaway zones' independence. The plan "has been accomplished fully and appropriately," Medvedev said.

Russia has complied "very largely" with the peace plan, but "that means that some (conditions) have not been implemented," Sarkozy said.

Leaders agree on freeze of missle deployments

A launcher of short-range Iskander missile rides in a column of Russian military vehicles, during a rehearsal for the Victory Day military parade in downtown Moscow

Medvedev has threatened to send his missiles to Kaliningrad

On the topic of the proposed US missile shield plan, which includes the deployment of interceptor missiles in Poland and radar stations in the Czech Republic, both leaders agreed that Russia and the United States should both refrain from deploying any new weapons systems in Europe before a major summit of European and North American powers in June or July 2009.

The 56-member Organization for Security and Cooperation in Europe (OSCE) should meet in June or July 2009, and "until then, please let's have no more talk about the deployment of missiles or anti-missile protection systems," Sarkozy said.

"Before a global agreement (on European security), we should all refrain from unilateral steps that affect security in Europe," Medvedev agreed.

Over the last year, Russia has repeatedly expressed outrage at US plans to site an anti-missile system on its borders.

On November 5, Medvedev threatened that Russia would site missiles in its Baltic exclave of Kaliningrad, across the border with Poland and Lithuania, if the US plans went ahead.

But in recent months, he has also called for "new security architecture" in Europe that would set legal limits on the use of force across the continent.

In October, Sarkozy said the idea was worth discussing, and that the OSCE, whose members include Russia, the United States, Canada and European states, should discuss it in late 2009.

But on Friday the two presidents "agreed that we don't need to wait until the end of 2009, we can do it in middle of the year on the basis of the OSCE," Medvedev said.

The EU, NATO and the Moscow-dominated Commonwealth of Independent States (CIS) and Collective Security Treaty Organization (CSTO) should also attend the summit, he said.

EU, Russia reach almost identical financial positions

French President Nicolas Sarkozy, center, his Russian counterpart Dmitry Medvedev, left, and EU Commission President Jose Manuel Barroso pose at the start of a meeting on Friday Nov. 14, 2008 in Nice

The two powers moved closer on their financial policies

As well as issues of defense, Sarkozy and Medvedev agreed almost identical positions on the financial crisis ahead of the G20 global summit in Washington.

"I think I can say that Russia's propositions were of great quality and that they are very close to Europe's propositions," Sarkozy said. "I'm pleased to see the Russian Federation's determination that some strong decisions be made at the Washington summit," he added.

Medvedev agreed, saying that Moscow and Brussels were heading to Washington with "practically common positions". He also backed Sarkozy's call for a second summit in February once US president-elect Obama takes office.

While it seemed unlikely that Europe and Russia would arrive in Washington with a joint blueprint, the two sides were moving closer together.

Medvedev and Sarkozy have blamed US economic management for a credit crunch that has brought down banks around the world, put the squeeze on businesses and consumers and pushed national economies into recession.

Sarkozy has called for the summit of more than 20 of the world's leading economies and emerging powers, to "remake the world financial system", creating a so-called Bretton Woods II.

An international conference at Bretton Woods, New Hampshire, in 1944 to shape the post-World War II financial system resulted in the creation of the World Bank and the International Monetary Fund.

Moscow has lobbied for change in the running of these bodies and, in particular, for more weight to be given to representatives of the so-called "BRIC" emerging nations, Brazil, Russia, India and China.

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