12:01 P.M. (Local)

PRIME MINISTER KOIZUMI: (As translated.) First I would like to express our sincere welcome to the visit of the President and Mrs. Bush. We are very happy to have excellent weather today, and I'm very happy that President and Mrs. Bush enjoyed the beauty of this ancient city of Kyoto.

Before this meeting, the President and myself had the pleasure of taking a pleasant walk through Golden Pavilion Temple. This is a wonderful environment where we can confirm the importance of our bilateral relations. We have been able to have the candid exchange of views between the two -- bilateral issues, particularly the importance of our relations in the global context. In other words, from the viewpoint of the European alliance and the world. That is the overriding context of our talk today.

We emphasized and confirmed the importance of closer consultation between the two. The United States remains the most indispensable ally to Japan. And if -- the better our bilateral relations, the easier it would be for us to establish better relations with China and other neighboring countries, and the countries in the world.

There is no such thing as U.S.-Japan relationship too close. Some people maintain that maybe we would pay more attention to other issues, probably it would be better to strengthen the relationship with other countries. I do not side with such views. The U.S.-Japan relationship, the closer, more intimate it is, it is easier for us to behave and establish better relations with China, with South Korea and other nations in Asia. This is my firm conviction on the basis of my thinking. Based upon our past, the importance of our bilateral relationships will not change. That is the basic understanding with which I had a talk with the President, and in which we will seek the future direction in establishing and seeking the prosperity and stability of all our nations.

At the same time, when you look at the issue such as the United Nations reform, the importance of our bilateral relationship looms even larger. We should recognize that. And we have been able to have a candid exchange. The United States expressed strong support to us becoming permanent member of the Security Council, and would like to deepen our cooperation on that issue.

On the issue of terrorism, this is going to be a long-lasting, difficult path we have to follow, and in close cooperation with the international community so that each nation will have a peaceful and stable atmosphere. In Iraq, as well as in Afghanistan, the people themselves should work harder to establish themselves as a nation. And we are pledged to provide our utmost assistance for that goal.

Further, concerning the issue of realignment and transformation of the U.S. forces in Japan and the reduction of burden on the local community, and the beef issue, BSE issue, and other future-oriented issues, such as bird influenza, that is an issue which requires closer collaboration between the two. But fundamentally, the importance of our bilateral relations should be recognized. If we do that, and then I hope that we would be able to continue to act as an ally, as a partner, on its own, autonomous and independent, in fulfilling the responsibility in the international community.

We were able to have very candid exchange of views, and hope that we would like to continue to have similar relationship of trust so that we can perform our obligations and duties, jointly, collaboratively, with the United States, for the benefit of the international community. That is all.

PRESIDENT BUSH: Prime Minister, thank you very much for your warm hospitality. Laura and I are so honored to be here in Kyoto, as well as in this beautiful Guest House.

It's no secret in my country that you and I have got a good relationship. I value you as a close friend. I appreciate our candid discussions, just like we had today. Relationships -- or the relationship between the United States and Japan is a vital relationship, and it's a very strong relationship. And a strong relationship enables us to work together to help keep the peace.

I admire the Prime Minister's political courage. I haven't had a chance to publicly congratulate him on winning his election. But he did so, and he did so in a way that confirms the great strength of democracy. He said, I'm going to take my message to the people, and we'll let the people make the decision as to whether or not there ought to be reforms here in Japan. And as a result of your courageous decision, Mr. Prime Minister, you prevailed. And I want to congratulate you for that.

We've got a good friend in Japan when it comes to spreading democracy and freedom. I appreciate the contributions of the Japanese people in both Iraq and Afghanistan. Today, I was able to tell the Prime Minister about important progress that is being made in the Middle East. The international crossing at Rafah will be opened up for the first time, in a while and should be open by the 25th of November. Other crossings will be opened up, as well. The seaport construction will begin. Travel between Gaza and the West Bank will take place. My point is, is that the freedom movement, the democracy movement, has got a very good chance of taking hold in the Middle East, in the Holy Land. And as it does, it is more likely that we'll be able to achieve the peace that we all want.

I also, in international affairs, made it very clear to us -- the United States made it very clear to the Prime Minister that our position has not changed on a permanent seat for Japan in the United Nations Security Council. I hope I'm viewed as the kind of fellow, when I say something, I mean it. I have said that consistently, and I still mean that, Mr. Prime Minister.

We talked about North Korea, and I appreciate the Prime Minister's understanding and willingness to join with five other nations in making it clear to the leader of North Korea that in order for that nation to be accepted in the international community, that it must verifiably dismantle all nuclear weapons programs. And I want to thank you for your strong stand on that, Mr. Prime Minister. We also join you in our concern about the abductee issue in North Korea.

We talked about trade. We both agree that the Doha Round must proceed. We both recognize that we've got work to do. The United States has made a very strong offer about agricultural subsidies. And again, I appreciate your understanding of this very important issue, Mr. Prime Minister.

We also talked about beef. And the Prime Minister and his government has taken a study on the issue, and has confirmed that U.S. beef would be safe. And I appreciate the fact that we're progressing on this issue.

We also talked about the need to continue to coordinate our aid, our development aid, and we've got a mechanism to do just that. Japan has been incredibly generous with taxpayers' money, the taxpayers' dollars to help those who suffer. And so has the United States. And I -- the better we coordinate, the more likely it is we'll be able to work together to solve the problems we all want.

I appreciate you bringing up avian flu. One of the important topics that we'll be discussing in South Korea is the need for us to work together to detect and share information on avian flu, a potential outbreak of avian flu. And so this is an issue of international concern, and the closer we all work together on this issue, the more likely it is we'll be able to do our job of protecting our fellow citizens against a potential pandemic.

Finally, I do want to congratulate the Prime Minister on his reforms. We're an active trading partner, bilateral trading partner with Japan, and it makes it easier to trade when the Japanese economy is growing. And we were reminiscing about my first trip to Tokyo. The newly elected President and the Prime Minister and I talked about the need to make sure our respective economies grew, and he talked about the idea of reforming the economy in order to create growth. And sure enough, it worked. The economic GDP grew at 4.5 percent annual rate in the first half of 2005. And I congratulate you on that, Mr. Prime Minister. That's good news. It's good news for the Japanese people; it's also good news for your trading partners. It's hard to trade with somebody who's broke. It's easier to trade with somebody whose economy is growing.

And so, Mr. Prime Minister, congratulations on your strong leadership. Thank you, very much, for your friendship. I look forward to continuing to work with you throughout my presidency and your term as the Prime Minister.

PRIME MINISTER KOIZUMI: We'd like to move on to the Q&A session. First of all, from the Japanese side, please. Any questions?

Q I have a question to both of you, Prime Minister Koizumi and President Bush. First of all, transformation. In your consultations, specifically, what kind of views were exchanged? Especially with the interim report after the two-plus-two, there's already objection being raised by the local communities in Okinawa. Prime Minister, how will you be responding as they proceed to the final report? And, President Bush, what are your expectations towards Japan?

PRIME MINISTER KOIZUMI: Now, with regards to the transformation of U.S. forces in Japan, the question just raised, the Foreign Minister, the head of the National Defense Agency, as well as the Secretary of State and the Secretary of Defense of the United States, have been repeating various detailed discussions. And the interim report was just announced very recently. And Okinawa, where the bases are located, as well as various local communities, are objecting and rebutting.

Thinking back, if you're asked, are you for or against having a base, naturally, one would respond, I am against. I think that's the gut feeling of the Japanese people. However, when we think about peace and security and safety, that is the context in which Japan can achieve economic growth. And in order to be able to benefit from safety and peace, we have to pay a certain cost. And that is what security is all about.

So that in mind, with regards to the local communities that are against the idea, we've been trying to persuade them with regards to the position we are placed in. And they are, in fact, enjoying the security being offered through the U.S.-Japan alliance, and, therefore, we hope that the local communities will rethink that very hard, and take up the issue of transformation very seriously in that context.

The government of Japan will have to make great efforts towards the resolution of this issue. Now, this is an issue that may require some time, but we are hoping that the proposal set forth can be realized, and, therefore, we will remain united as a government and make that the method.

PRESIDENT BUSH: My attitude on the issue is that our government negotiated in good faith with the Japanese government, and that Japan being a democracy as it is, will work out the issues according to the leadership of the Prime Minister and the will of the people.

Q Thank you, sir. Sir, as you probably know, the Senate rejected earlier today measures that would have required a timetable for withdrawal in Iraq, but a Republican resolution was overwhelmingly passed that called for more information from your information to clarify and recommend changes to U.S. policy in Iraq. So is that evidence that your party is increasingly splitting with you, sir, on Iraq? And is it an open challenge to you -- is that open challenge to you embarrassing while you're traveling abroad?

PRESIDENT BUSH: I, first of all, appreciated the fact that the Senate, in a bipartisan fashion, rejected an amendment that would have taken our troops out of Iraq before the mission was complete. To me that was a positive step by the United States Senate.

Secondly, the Senate did ask that we report on progress being made in Iraq, which we're more than willing to do. That's to be expected. That's what the Congress expects. They expect us to keep them abreast of a plan that is going to work. It's a plan that we have made very clear to the Senate and the House, and that is the plan that we will train Iraqis, Iraqi troops to be able to take the fight to the enemy. And as I have consistently said, as the Iraqis stand up, we will stand down.

I view this as a -- as an amendment consistent with our strategy, and look forward to continue to work with the Congress. It is important that we succeed in Iraq. A democracy in Iraq will bring peace for generations to come. And we're going to. The Iraqi people want us to succeed. The only reason we won't succeed is if we lose our nerve, and the terrorists are able to drive us out of Iraq by killing innocent lives. But I view this as positive developments on the Hill.

Q Concerning the dispatch of self-defense forces to Iraq, the 14th of next month is the time limit of the stationing. What kind of explanation did you make to the President about that? And how did President Bush evaluate that-- appreciate Japan's position on this? And what do you expect Japan to do further in Iraq on this issue?

PRIME MINISTER KOIZUMI: Concerning Japan's assistance toward Iraq, including the activities of the self-defense forces, we will want to see that the Iraqi people, themselves, bring democratic and stable nation by the power of the Iraqis, themselves. And they are making efforts toward that goal. Certainly there are political difficulties, but they are making progress.

So, against that background, as a responsible member of the international community, Japan should seriously consider what we could do to help the situation there. That has been our position, and there is no change in our basic stance.

What kind of assistance we are going to make in December? First, toward the reconstruction of Iraq, what we can do -- that, first, we have to think about, and then multilateral forces and other nations are involved in helping reconstruct Iraq. As a member of the international community, we have to join them. And further, on the basis of the importance of the U.S.-Japan alliance, we have to take all those things in a comprehensive manner, so that we seriously think what we could do to help the Iraq situation, and we make judgment on that basis.

PRESIDENT BUSH: Obviously, the extent to which the Japanese government wants to give reconstruction money to Iraq is up to the Japanese government. And as to the deployment of troops, that's up to the government. That's what happens in democracies -- governments make decisions that they're capable of living with. And that's -- that's what we said, said, do the best you can do; make up your own mind, it's your decision, not mine.

Q Mr. President, can you elaborate on your advice to China as to how much you want them to emulate Taiwan? Specifically, do you want the People's Republic to copy the governmental structure of Taiwan?

PRESIDENT BUSH: I'm going to be giving a speech on this subject here pretty soon. I hope you pay attention to it, George. My message to the region is, is that the region is better off as democracies spread. If you really think about this part of the world at the beginning of World War II, there was two democracies in the entire Pacific region -- Australia and New Zealand. And today there's a variety of democracies, and this is a peaceful part of the world.

I believe that societies are -- become stable and whole societies as they give people more say in the government. And so my message is universal, not necessarily trying to compare one system to another. In other words, you asked me about, should I say to China, you've got to emulate Taiwan. What I say to the Chinese, as well as others, is that a free society is in your interests. To allow people to worship freely, for example, in your society is part of a stable, mature society, and that leadership should not fear freedoms within their society.

As to the Taiwan-China issue, my message has been consistently clear, and that is, is that we support the one China policy, three communiques, and the Taiwan Relations Act, and neither side should unilaterally change the status quo. I will repeat that today; I will repeat it in China, as well, and the reason why it's important for this issue to be solved peacefully, for both sides to reconcile their differences through dialogue. And I'll continue to encourage dialogue on the topic.

PRIME MINISTER KOIZUMI: This concludes this meeting. Thank you.