Brown Palace Hotel; Denver, Colorado

MR. MCCURRY: Good afternoon, ladies and gentlemen. We're going todo a couple things - there are several stories I think you're pursuing atthis hour. I just want to do a couple of housekeeping things to start offwith.

The President began his day this morning meeting with staff, preparing forthe bilaterals he had. He also had a 20-minute phone call with PresidentFernando Enrique Cardozo of Brazil. The government of Brazil announcedtoday that they are joining the Non-Proliferation Treaty, the first timeBrazil has been granted accession to the NPT. The President called tocongratulate President Cardozo on that.

They chatted a bit about the President's enthusiasm as he looks forward tohis trip later this fall to Brazil. They talked a little bit about some ofthe themes that will likely be covered during that trip - certainly, tradeliberalization, sustainable development, educational cooperation and jointefforts to combat crime and drugs - a good preview of the upcoming tripthe President will take.

In part, it turns out the two Presidents' schedules will not overlap - they had looked forward to maybe seeing each other in New York next week- and that's why the phone call was arranged today.

The President, during the course of the morning, obviously had several updates from Washington on our understanding of the status of the tobaccotalks. The President has now made both a written statement and a statementjust moments ago during the meeting with President Chirac. That'savailable to all of you. I can take some questions on that.

Here to brief you on the President's bilateral meeting with President Yeltsin is Jim Steinberg and Deputy Secretary Summers is here, too, totell you more about the very important announcement concerning Russia'smembership in the Paris Club. We'll start with Jim, and then Larry.

MR. STEINBERG: Thank you, Mike. President Clinton and PresidentYeltsin met today for about an hour in their scheduled bilateral. It wasquite a good meeting. President Yeltsin was very vigorous, the discussionwas very animated. And it was one - it was really characterized in a verystriking way about the really productive quality of their discussionsthese days. They worked through a large number of issues, moved somethings forward, and it really was two men who are now very used to workingwith each other, familiar with the problems that they're having to dealwith, also familiar with the opportunities of trying to do thingstogether. And so they were able to accomplish quite a lot and cover a lotof ground in a very brief period of time.

They're really building on these regular meetings. This is the third timethey've met in the last several months. They met in Helsinki in March;they met in Paris last month in connection with the NATO-Russia agreement;and here today.

The discussion began, not surprisingly, with a discussion of how PresidentYeltsin was feeling. He told the President that he was feeling terrific,but his suits were a little too big and he had to deal with that challenge. He noted that he lost almost 30 kilos over the last year. And he also noted -- he said, "My brain is always moving fast, but now my bodyis also moving with more energy."

They began with a brief discussion -- President Yeltsin indicated Russia'sinterest in hosting an Olympic Children's Games in 1998, and that we'reworking with the Olympic Committee on that. The President agreed to lookinto that and see how we could be supportive.

The President then congratulated President Yeltsin on the successful conclusion of the Paris Club negotiations, which Larry Summers is going totalk to you about. The President said it was very good news; that whenthey had met in Helsinki they had identified this on the economic front asone of the early possible steps that could be taken in terms ofintegrating Russia into international economic organizations. He noted ithad only been 13 weeks since they had undertaken to do that and he wasvery pleased that they were able to come to such a good agreement.

Yeltsin noted that this had been a very productive period of several months. In addition to the NATO-Russia agreement, there had been some veryimportant agreements between Russia and Ukraine and particularly withrespect to the Black Sea fleet. He also pointed to the progress that hadbeen made in resolving the political problems in Moldova and theTransdnistria region, including the possibility of not being able to movethe Russian troops from there.

They talked a bit about their common efforts with President Chirac to address the problem in Nagora-Karabakh. The three Presidents are releasinga statement today, talking about their common efforts and the proposalsthat they've been making to try to move that process forward. BothPresident Clinton and President Yeltsin identified it not only as an areaof considerable danger if the problem were not solved, but one of greatpromise in terms of enhancing regional stability if they could makeprogress. And they made a joint commitment to push hard on that, seeing areal opportunity in the near future to move forward.

They next turned to their arms control agenda. The President recalled thatwhen they were in Helsinki they made a particular point of putting emphasis on the desirability of reaching a framework agreement on CFE,ideally, before the NATO Madrid Summit. Yeltsin noted that senior officials including Secretary Albright and Foreign Minister Primakov hadbeen working very hard on this issue and that there had been real progressand that it was quite possible that they could reach an agreement on theframework before Madrid, although there was a lot of work yet to do. Andthose discussions will continue on the margins here.

They talked about the ABM-TMD demarcation agreement which was another of the important decisions that had come out of Helsinki, where theprinciples for that agreement were set up and experts now meeting to tryto put that into a formal document. There's an experts group sessionscheduled for July, and they both agreed that they would try to use thatsession to try to finish off the agreement.

They also had a conversation about their mutual interest in getting the START II extension protocol ratified by the Duma so that it would bepossible to go on to START III. The President indicated that he was veryeager to move forward with that, saw it very much in the strategic andeconomic interest of both countries.

Yeltsin agreed; he said that although there were a lot of things on his plate, that he was determined to give it a real push with the Duma. Andthe President expressed appreciation for that, and also appreciation for the efforts of Foreign Minister Primakov in trying to move that forward.

They discussed in a little bit of detail their efforts to move forward onimplementing the NATO-Russia Council that was agreed in Paris. They bothchastised their bureaucrats for not moving fast enough on this andpromised to give a real push to that effort.

They then turned to the third element of the Helsinki agenda, that is theeconomic issues. The President congratulated President Yeltsin on some ofthe progress that had been made in enacting reforms, including taxreforms, and the successful recourse of the financial markets that Russiahas recently been able to do in terms of its bond sales.