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US Secretary of State Condoleezza Rice on Iran, January 23, 2008

Interview With Maria Bartiromo of CNBC's Closing Bell, Secretary Condoleezza Rice Davos, Switzerland January 23, 2008.

QUESTION: Let me ask you a little about Iran. This week, you closed the third resolution.


QUESTION: Tell me about that. What are you expecting out of this? How momentous is this for you?

SECRETARY RICE: It demonstrates yet again that there is international solidarity behind the proposition that Iran cannot be allowed to get a nuclear weapon, that it cannot be allowed to have the technologies that can lead to the development of a nuclear weapon. And I think it's extremely important that we refocus on the international consensus. And so the European-3, Germany, France, Great Britain and Russia, China, and the United States agreed on this resolution. It will go now to the United Nations Security Council for consultation with the other members of the Security Council and in several weeks, we expect a vote.

QUESTION: Now in fact, recently, you did face pressure, though, and challenges from China and Russia. What was behind these challenges and what was the reaction at the end of the day?

SECRETARY RICE: Well, I've always felt, Maria, that we have strategic consensus about Iran, that you cannot have a nuclear-armed Iran. But we've had tactical differences from time to time; when do you put forward a resolution, how strong and extensive should the resolution be. But what has been really important, and it was important to reaffirm it in this third resolution, is that Iran can't say, "well, this is just the United States," or even "this is just the West." They have to recognize that all of these powers, even states that have good economic relations with them like China and Russia, are determined that they are not going to get a nuclear weapon.

QUESTION: How concerning is it to you? How concerning should it be to the rest of the world, certainly to America, that we are seeing such strong ties - is that the right word - between China and Iran?

SECRETARY RICE: Yes, yes. Well, a lot of countries have diplomatic relations with Iran and have had economic relations with Iran. The United States is unique in having no diplomatic relations with Iran. Many of our best friends, in fact, do. But what is happening, and I think your listeners in particular would understand this, is that as the cloud gathers over Iran, as they're under Chapter 7 resolution after Chapter 7 resolution, people are becoming concerned about the investment and reputational risks of doing business with Iran. The combination of UN Security Council resolutions and measures that the United States and others have taken outside of the Security Council track, I think, has made it difficult for Iran to maintain good standing in the international financial system. And that's not good for Iran. It's having an effect.

QUESTION: And the companies that still do business with Iran, how tough can America be on those countries - on those companies, rather, pardon me - what do we do?

SECRETARY RICE: If anyone wants to imagine a Middle East in which Iran has a nuclear weapon, now you're talking about the real downside for energy. Now you're talking about the real downside for economic interest. And so it really behooves everyone to look at this, to look at investment, to look at the question of economic activity with Iran. And Hank Paulson said it very well once; he said, you know, when you're doing business with Iran, you really don't know who you're doing business with.

QUESTION: Is there reason to believe that the ties between China and the U.S. have become somewhat frayed because of the challenges they put forth up against this resolution?

SECRETARY RICE: Look, it's natural that we may have differences about precisely how to proceed. That's the nature of diplomacy. And so I've found, particularly in the last couple of months, that the Chinese have been wanting to defend their interest, but they've also wanted this resolution to go through. I think the Chinese understand that you cannot have a world in which the most dangerous weapons are proliferating to some of the most dangerous states.

QUESTION: How would you characterize our relations with Russia today and how do you see the election process taking place in the coming year?

SECRETARY RICE: Well, clearly relations with Russia are complex. I think that's probably the best word that we can use for it. In terms of the internal circumstances of Russia, though, I think we have always hoped that Russia would have high expectations for itself, that it would have competitive presidential elections, elections in which the Russian people are getting a full choice and in which competitive candidates have full access to the media.

QUESTION: It was estimated to me that Putin has some $50 billion, given, you know, his actions with privatizations of companies. Do you believe that?

SECRETARY RICE: I don't know. And I think what we've been concentrating on is that Russia, as a critical and important energy supplier, should be a reliable energy supplier. It should be a transparent energy supplier. And we talk often about the need for diversity of supply and diversity of supply routes. As sometimes the Russians say, well, are you saying that people shouldn't deal with Russia? No, absolutely not. But we would hope that Russian energy would be -- Russian energy practices would be more on an economic basis, and certainly the use of energy for political purposes is just not sound.

QUESTION: And not use energy as a weapon.

SECRETARY RICE: Yeah, exactly...

Source: US Department of State, www.state.gov.

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