"I strongly condemn the Syrian government's unspeakable assault against the people of Homs and I offer my deepest sympathy to those who have lost loved ones," Obama said.
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Assad has "no right to lead Syria, and has lost all legitimacy with his people and the international community," he said.
"Assad must halt his campaign of killing and crimes against his own people now. He must step aside and allow a democratic transition to proceed immediately," Obama said. He underlined the need to work with the Syrian people to build a brighter future for Syria.
"A Syria without Assad could be a Syria in which all Syrians are subject to the rule of law and where minorities are able to exercise their legitimate rights and uphold their identities and traditions while acting as fully enfranchised citizens in a unified republic," he said.
Obama said the Syrian regime's policy of maintaining power by terrorising its people only indicates its inherent weakness and inevitable collapse.
The powerful United Nations Security Council on Saturday failed to adopt a draft resolution condemning the Assad regime and endorsing an Arab League plan for a political transition, following veto by both Russia and China.
