Thank you Mr. Chairman, I would like to provide a brief report on behalf of all three of the Minsk Group Co-Chairs, the United States, Russia and France, about the current situation, as we see it, involving a resolution of the conflict in Nagorno-Karabakh. We are pleased with the direct talks that are taking place today. We have been very pleased at watching the expansion that has occurred in this process in the past several weeks.

Today, the President of Armenia and the President of Azerbaijan, President Kocharian and President Aliyev, were meeting on the border between Nakhichevan and Armenia.

This past Friday, the Defense Ministers also met upon their border. There is a strong expectation that the Armenian/Azerbaijani Foreign Ministers will meet tomorrow on the margins of another meeting in Luxembourg. This will be their sixth meeting.

We have seen from these meetings a new atmosphere emerge that we think is decidedly different than what had existed, as the Chairman just said, several months ago. This is not the first time the parties have engaged in direct talks. Direct talks also took place in the mid-1990’s, but there is a decided difference. In the mid-1990’s, those talks were between the two sides, between Armenia and Azerbaijan, at a middle level. The talks that we see today have basically started at the presidential level. They started with a meeting in Moscow followed by a meeting in Washington, followed by two meetings in Geneva, followed by the meeting that we now see happening today--direct meetings at the highest level possible. The Co-Chairs believe this underscores the political commitment attached by both countries to seeking to find a solution to this problem.

We are also heartened by the fact that there have not simply been meetings between the presidents of the two countries, there are also meetings between the foreign ministers and defense ministers. Those meetings suggest that the contacts between the two do not simply deal with broad theory or principals, but are also beginning to look at details.

I would point out that both Armenia and Azerbaijan have noted publicly the need for compromise to find a resolution of the problems that exist in the region. We think that is very positive. They have also both been very careful to maintain strict confidentiality on the talks that have taken place between them. The Co-Chairs believe that it is both correct and prudent and has also served to propel this process ahead.

As the Chairman noted, the OSCE Chairman-in-Office has been actively engaged in this process, and the Co-Chairs wish to thank him and express our sincere appreciation for the work he has done, and the strong support Foreign Minister Vollebaek has given us. His recent visit to the region underscored the commitment of the OSCE to advance this process vigorously.

The Co-Chairs would also like to commend the Personal Representative of the CiO, Ambassador Kasprzyk, for his tireless efforts in the region, particularly the efforts in facilitating the recent release of POW’s both from Armenia and from Azerbaijan. The Co-Chairs themselves have had a variety of contacts with the parties both as a group, and through independent national contacts, in the past several months.

We have also remained in close contact with Chairman-in-Office Vollebaek. In fact we have met with him twice in Oslo in the last month alone. We gave Minsk Group representatives--the broader group--a detailed briefing on Friday here in Vienna. The consensus of that session was that there was cause for guarded optimism with regard to progress on the situation in Nagorno-Karabakh.

It is our hope that this issue will be a positive aspect of the Istanbul Summit. The Co-Chairs will continue to work wherever possible with all the parties as they move toward common positions which could support renewed negotiations under Minsk Group auspices as the parties move toward what we hope would be the framework that could establish a durable settlement.