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Wednesday, August 25, 1993

Michael McCurry


Prime Minister Supports Indefinite Extension of

Transfer of M-11 Missile Components to Pakistan .....1-18,20-21,24
--  US Determines MTCR Violated/Sanctions ................1-15,17,20-21, 
--  US Sanctions/Contacts with Parties/Allies ..........1-2,8,13-15,17
--  Extent of Pakistan's Missile Capability ....................13
Status of Ship Suspected of Carrying CW
Han Dongfang's Passport Canceled/US Reaction ...........17-18

Possible Transfer of Hawkeyes by US ................................6

Foreign Secretary's Meetings at Department ..................17

Report of North Korean Scuds Transported by

Department Providing Security Training for ANC

US Expects Bilateral Talks to Resume Next Week ........22

Proposed Peace Agreement/Deadline .................................22-23
Humanitarian Relief 
US/Others Contacts with Croatia re:  Mostar .................25

Investigation of Death of Fred Woodruff ...........................23

Settlement of POWs in US 

Conflict in Nagorno-Karabak/CSCE Negotiations ...........23-24
Status of Former President Elchibey 

Possible Response to Publicizing Reward for 
      Information on Mir Aimal Kansi 


                           DEPARTMENT OF STATE
                           DAILY PRESS BRIEFING

                                                      DPC #119

                  WEDNESDAY, AUGUST 25, 1993, l:l4 P.M.

          MR. McCURRY:  Good afternoon, everybody.  I apologize for the 
delay, but I wanted to be able to share some breaking news with you, so 
I thought it would be wise to delay.

          I'll start with two proliferation-related items.  

          The first is I call your attention to the statement on August 
23 by the Japanese Prime Minister in his, I think, maiden speech before 
the Japanese Diet.  He noted that non-proliferation of weapons of mass 
destruction is an urgent security imperative for Japan, and he announced 
in Tokyo that he intends to support the indefinite extension of the 
Treaty on the Non-Proliferation of Nuclear Weapons.  This announcement 
to support the indefinite extension of the NPT came as part of the Prime 
Minister's first major policy address to the Japanese Diet.

          The United States warmly welcomes this action by Prime 
Minister Hosokawa, which stands as a reaffirmation of Japan's dedication 
and commitment to the international nuclear non-proliferation regime.

          We believe that continued strong international support for the 
NPT will contribute to the achievement of its indefinite extension in 
l995 -- a goal to which the United States attaches great importance.

          There is a fuller statement that will be posted in the Press 
Office, after the briefing, on that item.

          And then, secondly, to report to you that just concluded this 
morning our meetings that Under Secretary of State for International 
Security Affairs Lynn Davis had with the Ambassadors of China and 
Pakistan.  Under Secretary Davis has presented to the Governments of 
China and Pakistan the determination of the United States Government 
that certain Chinese and Pakistani entities had engaged in missile-
related transfers that required the imposition of sanctions under U.S. 
law.  This decision follows a close examination of a growing body of 
evidence over several months.

          The United States made repeated contacts with both governments 
in an attempt to clarify numerous reports from many sources about an M-
ll missile-related transfer from China to Pakistan.

          United States law calls for the imposition of sanctions on 
foreign persons who knowingly transfer, to a non-MTCR country, Missile 
Control Technology Regime Annex items that contribute to the development 
of missiles capable of carrying a payload of 500 kilograms a distance of 
300 kilometers, or roughly l,l00 pounds over a distance of about l90 

          In this case, the United States Government has decided to 
impose what are called "Category II" sanctions.  Category II sanctions 
are imposed if the transfer involves certain items in the MTCR Annex 
which contribute to missile development.

          Category II sanctions require denial of new export licenses 
for MTCR Annex items, both munitions and dual-use items, and denial of 
U.S. Government contracts relating to MTCR Annex items with the 
sanctioned entities for a period of two years.

          This is obviously a fairly complex determination that Under 
Secretary Davis has made.  We're going to try to make available to you 
later this afternoon a copy of the notice that will be published in the 
Federal Register that contains some detail on the applicable sections of 
U.S. export control law that are cited in making this determination.

          Obviously I suspect you will have some questions about the 
impact and the effect of this decision, and I'm happy to take those 

          Q    Could you do that again in English, please?  (Laughter)

          MR. McCURRY:  Yes.  

          Q    What does this mean?  What did they do that provoked 

          MR. McCURRY:  For a period of many months, I think as many of 
you know -- and we have covered here often -- we've been looking at the 
question of whether a certain shipment in l992 contained items that are 
sanctionable under the relevant U.S. law, which is both the export -- I 
guess I want to make sure I get it right -- the Export Administration 
Act and the Arms Control Act as amended.  That's a question that 
involves information that comes to the United States that we gather 
from, as we say, numerous sources, numerous places.  It takes a great 
deal of time and effort to evaluate that information, but the effect is 
that once you have made a determination that a transfer has occurred 
that is a violation of the MTCR guidelines, under U.S. law the 
imposition of sanctions is immediate.

          So over this period of time, I think through a variety of 
means and efforts, we have been seeking to clarify the nature of that 
shipment.  The determination that the Under Secretary made last night, 
after an extensive review within the United States Government, is that a 
sanctionable transfer has occurred and that the sanctions now go into 

          Q    Mike, does this refer to one, and only one, shipment that 
you're concerned with?  Are you satisfied that no other shipment has 
occurred previously or after that between China and Pakistan?

          MR. McCURRY:  This decision, this determination, relates to a 
single sanctionable transfer.

          Q    Well, Mike, how many countries or companies are affected 
by the sanctions?

          MR. McCURRY:  There are two -- the decision itself affects the 
entities that were engaged in the transaction and their subsidiaries -- 
that is the Ministry of Aerospace Industry in China, which includes the 
China Precision Machinery Import-Export Corporation, and the Ministry of 
Defense.  But since the imposition of sanctions also relates to some of 
their sub-units and subsidiaries, I think there are a total of l0 
different entities in China that are included in the determination 
that's made.

          Q    What does this mean for those l0 entities?  Does this 
mean that you cannot do any trade?  Were we doing any business with 
these entities as it was?

          MR. McCURRY:  I think as you know, because of the Tiananmen 
Square sanctions, the number of transactions that are involved was 
fairly limited.  

          Now, the effect of this decision really goes to satellite and 
satellite technology.

          Let me cover first a little bit just what exactly the 
sanctions are, and again it's fairly technical stuff.

          Category II sanctions -- which is what we're talking about 
here under the law -- require a denial of any new export licenses for 
items that are on the MTCR Annex lists.  That's both munitions items 
that are regulated by the State Department's munitions lists and then 
items that are on the Commerce Department's control list, which affects 
dual-use items; and those sanctions would extend for two years.

          The sanctions also require denial of U.S. Government contracts 
relating to MTCR Annex items with the sanctioned entities for two years.

          Now, in the case of Pakistan, there's been very little 
commercial activity that qualifies under the MTCR guidelines to begin 

          In the case of China, there has been -- again, as I say -- 
little commercial activity, because of some of the pre-existing 
sanctions -- the Tiananmen Square sanctions -- but the principal effect 
of Category II sanctions now imposed will be to prohibit the export to 
the sanctioned entities of satellites that contain U.S.-licensed items 
on the MTCR Annex lists.

          Now, it gets a little more complicated than that because in 
the case of China, under the so-called Helms Amendment, the Helms 
Amendment affects the imposition of sanctions when they involve non-
market economy countries which are not members of the former Warsaw 

          So, in that case -- which is obviously specifically China, 
among others -- the effect of the sanctions extends to all government 
activities, or all government entities or activities that are conducting 
a MTCR-related trade.  That effects -- I think in addition to the sale 
of items that are directed at the two entities that are cited in the 
determination, that could also affect the development or production of 
electronics, space systems or equipment, and military aircraft that is 
conducted under licenses for export that include some of the MTCR Annex 

          Q    What is the total dollar amount -- 

          MR. McCURRY:  The total?  We estimate -- it's a little hard to 
estimate what the dollar impact is.  In FY 1992, which is the most 
recent year for which complete annual statistics are available, the 
commercial effects of items in this category that would be affected by 
the sanctions is roughly $370 million.

          Now, we don't know -- it's hard for us to know what types of 
contracts for sales might be in effect over the next two years or might 
have been proposed for the next two years, but it's our estimate that 
somewhere between $400- and $500-million a year of commercial activity 
will be affected by the sanctions that are imposed today.

          Q    Is that two-way trade or U.S. exports?

          MR. McCURRY:  This affects U.S. exports.  When you get into 
the difference between Category I and Category II on the sanctions, you 
sometimes get into the issue of whether it  extends to import activity 
as well.  Typically, in a Category I sanction, you would see 
restrictions on imports; but this affects only the exports to the 
entities -- and then in the case of China, exports to the other 
government entities that would be conducting MTCR-related commerce.

          Q    Mike, does this mean that the Chinese exports are not 
affected in any way to the U.S.?

          MR. McCURRY:  That's correct.  It would be a separate 
determination if imports were to be affected.

          Q    Mike, what about contracts for the Chinese to do space 
launch services for the U.S. Government?

          MR. McCURRY:  The U.S. Government contracts are specifically 
included within the sanctions themselves, so that's included within the 
sanctions.  I believe it's all --

          Q    (Inaudible)

          MR. McCURRY:  It is no U.S. Government contracts relating to 
MTCR equipment or technology and involving the Government activities 
described above -- which includes electronics, space systems or 
equipment, and military aircraft -- can be entered into for a period of 
two years.

          Q    Do you know of launches that had been planned?

          MR. McCURRY:  Well, I am told that there was not much activity 
planned in the category of proposed Government contracts, to begin with.

          Q    But weren't there telecommunications contracts that were 
pending with China for launching equipment on Chinese satellites?

          MR. McCURRY:  Yes.  I don't think those were U.S. Government 

          Q    (Inaudible) would they be affected?

          MR. McCURRY:  Yes.  

          Q    They would be affected.

          MR. McCURRY:  They would be affected, and that's the type of 
activity that we're talking about within the category of what we 
estimate to be, as I say, anywhere from $400- to $500 million a year in 
economic activity.

           Q    When you say it's going to affect $400- to $500 million 
in economic activity, what you really mean is that this decision will 
cost U.S. businesses -- who might have sold up to $500 million of goods 
to China -- they will not be able to conduct that business.  

          MR. McCURRY:  They will not be able to conduct that business, 
and of course that's a significant cost that we pay; but it, again, 
reflects the seriousness with which we look at the issue of 
proliferation -- which, again, as you know, we consider probably the 
most important arms control issue in the l990s.

          Also, frankly, it is something in which we execute the letter 
of the law.  This is the way the law requires the United States 
Government to respond when there has been a determination that this type 
of sanctionable activity has occurred.

          Q    How much latitude was there under the law in terms of 
imposing sanctions?  Could the U.S. Government if it chose to, have 
imposed more extensive sanctions than this?

          MR. McCURRY:  Well, there is not much latitude under the law.  
The law is very, very specific; and then Dr. Davis, as she looks at the 
decision and prepares the recommendation, has to evaluate the evidence 
very, very carefully -- which is what's been done.

          I should also add that the review process on this issue 
obviously started under the Bush Administration, and the President has 
the ultimate authority to execute the law.  President Bush had 
transferred that authority to the State Department, and that's why the 
Under Secretary is the one who is looking at the issue.

          But I should point out that there's been extensive interagency 
work on this issue.  The White House has been very actively involved 
every step along the way as well, and of course the President was aware 
of the decision before we announced it today.

          Now, the question is:  How much latitude is there?  And 
there's not any latitude, in reality, if you have to find sufficient 
evidence that a transfer has occurred.

          Now, what Dr. Davis has done in this case is found that there 
is unambiguous evidence that a Category II transfer has occurred, but 
there's ambiguity on the question of whether or not a Category I 
transfer has occurred.

          Q    Can you explain the difference to me?

          MR. McCURRY:  I can.  There is a difference.  The issue is the 
difference under the Missile Technology Control Regime guidelines and 
Annex, the difference between Category I items and Category II items.

          Category I items are complete rocket systems, in effect.  I 
mean they are missiles.  They are complete subsystems -- including 
rocket stages, rocket engines, guidance sets.

          The items that are in Category II are subject to some 
technical parameters.  They include things like rocket propellant; 
mechanisms for separating rocket stages; rocket motor cases, insulation 
and nozzles; instrumentation and navigation equipment; flight-control 
systems -- such as altitude-control equipment; avionics equipment -- 
such as radar and global positioning systems; launch support equipment 
-- such as vehicles for transporting or launching rockets and tracking 
systems; certain types of computers and software; testing facilities and 
equipment -- such as wind tunnels; and production equipment or technical 
data related to the above equipment.

          That's a fairly complete listing because it gives you some 
nature of the types of things that are looked for, and, you know, can 
determine that those are the things that actually transfer.

          They were also important because those are the things then 
that the sanctions themselves apply to.

          Q    Are the companies that are going to lose out on these 
contracts indemnified in any way by the U.S. Government?

          MR. McCURRY:  Not that I'm aware of.  

          Q    They would lose this, is that right?

          MR. McCURRY:  They would lose future contracts.  Now if they 
have contracts in effect now, my understanding is that those contracts 
remain in effect.  So this affects new licenses for exports.

          Q    Once the transfer took place, was there anything the 
Chinese could have done to have avoided these penalties?  I know there's 
been a lot of contacts between the governments; but once it took place, 
after you determined that it took place, did you have to impose this?  
And, also, did Ms. Davis present specific evidence to the Ambassadors 

          MR. McCURRY:  Again, I want to stress that Dr. Davis made the 
determination last night that the transfer had occurred.

          Now, why last night and not earlier, since this is something 
that we've obviously been looking at for a long time -- and this goes 
really to the answer to your question.  We have repeatedly raised with 
both the Government of China and the Government of Pakistan our concerns 
about this particular transfer.  We have sought numerous occasions, 
including the Secretary's meeting with the Chinese Foreign Minister in 
Singapore, I believe that was July 25; Dr. Davis' meeting with high 
representatives of the Chinese government in Beijing, July 29; meetings 
that we held with the Acting Prime Minister of Pakistan here in 
Washington; and subsequent contacts with the Pakistani Government.  
We've had extensive diplomatic contact with both governments, asking 
them very specific questions that would help the United States analyze 
and evaluate the information that we have gathered.

          The response in every case to those repeated inquiries has 
been unsatisfactory.

          Q    Filing break?

          MR. McCURRY:  A filing break has been requested.

          Q    Can I have a follow-up on this?

          MR. McCURRY:  A filing break has been granted.

          Q    I don't know, you might have to take this, but what 
happens in a situation where I believe you have the U.S., Australia and 
China cooperating on a satellite?  I think that was telecommunications.  
What happens to that kind of future, three country --

          MR. McCURRY:  I'm sorry.  Say again?  In a tri-government --

          Q    Yes, could you look that up and take that if you have to?  
I don't know if you have -- 

          MR. McCURRY:  Three -- you're asking about a specific 
transaction --

          Q    Yes.  You had, a few years ago, the U.S., Australia and 
China cooperating on a -- I think it was a telecommunications satellite.  
Now, if there are future satellites like that in the works, what 

          MR. McCURRY:  Well, transactions of that nature in the future, 
since they would involve export licenses for a certain types of MTCR-
related items, would clearly be affected by this determination.

          Q    Mike what was in the shipment that you specifically 
related to here -- which of that long list of things were in the 

          MR. McCURRY:  There are limits on what we can say publicly 
about what we know about the shipment, what we believe was contained in 
the shipment, how we evaluate it, what was in the shipment, because it 
all involves sensitive procedures for collecting information and 
evaluating information, and you know routinely that is not something 
that we can discuss.

          Q    Can you say anything about what was in the shipment?  You 
said there were limits on it -- where do those limits stop?

          Q    (Inaudible) launchers?

          MR. McCURRY:  The question of whether they were launchers, 
whether they were other types of things, I just really am not in a 
position to get into specifically what we know about the shipments.  But 
I think it is sufficient to say that we presented very detailed and 
precise questions to both the Governments of China and Pakistan asking 
for clarification.  And, again, as I say, the answers were 

          The shipments, clearly, contained missile-related technology 
and components that led to the conclusion that a sanctionable event had 

          Q    Mike, has there been any contact with foreign governments 
that favor the non-proliferation idea?  And to what extent are they 
cooperating with the United States on this?  Or will our hit of a half 
billion dollars, apart from the morality of the thing, the economic 
factor, just merely hurt the United States' business and industry while 
others gain by that very fact?

          MR. McCURRY:  Joe, that's a very good question; and the answer 
is that as part of the Missile Technology Control Regime, we work very 
closely with our partners in that regime to study the impact and the 
enforcement of applicable domestic laws that then relates to the regime 

          Now, all of our partners obviously will be notified of this 
determination.  It will have substantial impact on commercial activity 
that other countries engage in.  In fact, some of our closest partners 
and some of the people who work on this issue have known for some time, 
obviously, that we had this matter under consideration and have asked to 
be kept informed because they, of course, will want to examine their own 
export control procedures as a result of this determination.

          So this is something, again -- because it's a cooperative 
effort in the international community -- it's something that a 
determination like this does resonate beyond just the commerce involving 
the United States.

          Q    Will Pakistan still be allowed to purchase spare parts or 
to complete purchases of spare parts and maintenance contracts on jet 
fighters they bought from the United States?

          MR. McCURRY:  You mean the F-l6 fighters?

          Q    Yes.

          MR. McCURRY:  I think that I'd have to look at that question 
in particular.  I think it would depend on whether there are existing 
contracts in effect, and I'd really want to take that question 
specifically to make sure that we get the right answer on it.

          Q    All right, but if it's not in an existing contract, it's 

          MR. McCURRY:  If it's a new contract for sale -- 

          Q    For maintenance or spares, wouldn't it be --

          MR. McCURRY:  I'd have to double-check.  It would obviously 
depend, first of all, if the entity in that sale was -- and I believe it 
was -- the Ministry of Defense, and then, secondly, whether the items 
that are on the sale are on the MTCR Annex.  The answer would be 
dependent on the nature of the parts and whether they were covered on 
the MTCR annex.

          But I will check, because I think it is a question that 
relates to that prior sale.  I'll check again.

          Q    Besides notifying other governments, has the U.S. gained 
any commitments from any of its partners about their restraints of trade 
with China?

          MR. McCURRY:  I think a number of our closest allies were very 
interested in this decision.  I think we will be conveying to them 
information about this determination so that they are aware of it.  I 
just don't have the answer on how many of them have come back to us and 
said we share your concerns or we will do likewise.  I just don't have 
any information about that response.

          Q    A lot of them would be very interested, as you say, for 
mirror-image reasons.  A lot of them would be very interested for the 
purposes of picking up the slack.

          MR. McCURRY:  Making a sale.

          Q    Exactly.

          MR. McCURRY:  Right, right.

          Q    So it's a critical question as to whether you've 
consulted with your partners in the MTCR, and there aren't that many of 
them, and whether you've received any sympathetic responses prior to 
this announcement?

          MR. McCURRY:  We consult with them regularly on proliferation-
related issues, and I think they are aware of our examination of this 
issue.  I think that we are only now making them aware of the 
determination that Dr. Davis made last night.

          The United States does feel very strongly about proliferation 
of this nature in a region of the world in which there is great 
potential for conflict and destabilization.  I think conveying that 
concern directly and noting the impact of this decision is something 
that we certainly will do, and we hope that our allies and friends will 
take note.

          Q    Now, though, allied associations are free to do their 
business, right?

          MR. McCURRY:  Hold one.  One second.

          Q    Will we be asking our allies and friends, specifically, 
to not fill the void here?

          MR. McCURRY:  There are specific requirements under the MTCR 
itself on how other governments will respond.  I'll find out more about 

          By the way, I think it would be helpful if you had a chance to 
talk to Dr. Davis later today.  Would there be some interest in that?

          Q    Yes.

          MR. McCURRY:  She will be available and is willing to be here 
at 3:30 today for some follow-up questions, if you want.

          Q    On the record?

          MR. McCURRY:  Yes, we'll put it on the record.

          Q    Will the sanctions cover SUPALCO, Pakistan's space 

          MR. McCURRY:  I'm sorry, say again?

          Q    Do the sanctions cover SUPALCO, Pakistan's space agency 
-- SUPALCO is the name of the agency?

          MR. McCURRY:  Let me check.  I don't believe so.  We will give 
you the list later of the ten entities that are affected, but I don't 
see that listed.  These are principally Chinese entities that are 

          I think in the case of Pakistan, it affects the Ministry of 
Defense.  That's the specific entity that is then affected by the 
sanctions themselves.

          Q    After you finish with the missiles, do you have anything 
on the Indian Foreign Secretary's visit -- a statement?

          MR. McCURRY:  Let's finish on this issue.  But the quick 
answer is, I don't.  I think a lot of those sessions are taking place 
even as we speak here.  I'll see if I can try to get some more readout 
either later or for tomorrow on those meetings.

          Q    You didn't answer my earlier question about, did Dr. 
Davis present specific evidence to the Ambassadors, when she met with 
them, of what you know to have been delivered to Pakistan?  Did she give 
them specific evidence to back up the allegations?

          MR. McCURRY:  I guess I would phrase it a little bit 
differently.  We posed to them very specific and precise questions.

          Q    I mean today.  You said she met with them this morning -- 
right? -- to inform them of the decision.

          MR. McCURRY:  Oh, yes.  I'm sorry.  When she met with them 
today, she went through the determination and went through her findings 
based on the information that we looked at and, I think, gave them what 
is called a non-paper on the issue.

          Q    A what?

          MR. McCURRY:  Delivered them a non-paper on the issue.

          Q    When you say that their answers or responses to these 
questions over the course of months have been unsatisfactory, can you be 
more specific in how they did respond?  Did they say, "The United States 
is flat wrong?"  Did they say, "We're not going to talk to you about 
these things?"  What kind of response did you get?

          MR. McCURRY:  You probably have seen public comments that 
they've made in the past, and I would suggest that their response in 
these diplomatic exchanges has been very similar.  They say, 
essentially, that their commitment to adhere to MTCR guidelines has not 
been violated by any of these transfers.  We, of course, then come right 
back to them and say, "Well, then, we have some very specific questions 
we would pose to you to help us understand questions that we have."  And 
the answers, as I say, that we get back don't illuminate.

          Q    Did the Pakistanis try to explain their, maybe, security 
concerns as motives for their transfers?

          MR. McCURRY:  In the case of Pakistan, since they were the 
ones on the receiving end of this transfer, I think that they clearly 
were in dialogue with China on the question of how to respond; but I 
really wouldn't want to characterize beyond that the nature of their 

          Q    Will President Clinton grind this case into his thinking 
when he considers renewal of MFN next year?

          MR. McCURRY:  He won't for the very specific reason that when 
the President signed the Executive Order on May 28 concerning Most 
Favored Nation status, he really set aside -- if you recall that 
Executive Order -- he set aside exactly these questions of proliferation 
so that they could be looked at, examined, and then the relevant U.S. 
law could be enforced separate from the decision or the review next year 
of Most Favored Nation status.

          When you get to the criteria that he is now looking at, when 
it reflects Most Favored Nation status, they are the ones that he's 
listed before involving the Universal Declaration of Human Rights, the 
rights of citizens who have been held under detention, international 
radio/TV broadcasts -- there's a variety of things that he listed in the 
Executive Order itself that he would look at.

          But, clearly, as the Executive Order itself says, one of the 
things that is an aspect of our bilateral relations is work on these 
proliferation issues which the United States takes very seriously.  It 
is not the sum and substance of our relationship; and, obviously, we 
would certainly hope that there would be additional opportunities to 
work closely with the Chinese on a wide variety of other issues.  But 
this issue required this very direct response under U.S. law that's now 
been administered by the Under Secretary.


          Q    Although this is Category II, does the United States 
believe that Pakistan has received from China and/or from any other 
sources enough components to assemble a full M-11 missile system?

          MR. McCURRY:  That's a specific question that's got a specific 
answer somewhere in all these papers.

          Q    Make one up.

          MR. McCURRY:  Make one up?  I'd probably make up an answer 
that would get me in trouble if I answered it directly.

          I'll just go back.  Category II sanctions really do affect 
both the technologies that can help a non-MTCR member acquire, develop, 
produce -- well, there are categories of things described under the law 
itself which a non-MTCR member can develop once acquiring the technology 
itself, and that's covered in Category II, and I would kind of fall back 
on that.

          Q    Mike, can you take the question because it is basically a 
yes-or-no question.  Do they have --

          MR. McCURRY:  Do we think they've got the --

          Q    Components.

          MR. McCURRY:  -- means necessary currently --

          Q    Yeah, to launch a missile?

          Q    Mark's question was, did they get it from China?  The 
question is:  Does Pakistan have an M-11 missile capability now?  And, 
if so, how much of it came from China?

          MR. McCURRY:  I'll take that question, because that's one 
that's going to require a very precise answer -- probably beyond the one 
that I gave.

          Q    Do you know of any other cases that could be sanctionable 
in the same way?  I mean, are there any other cases under investigation 
or under consideration by the United States?

          MR. McCURRY:  We look at these types of cases and these 
questions all the time and I think, as you know, we dealt recently with 
the Government of Russia concerning the sale to India -- in a different 
fashion, but it was a related or similar type of issue.

          I'm not aware of any specific transfer that would require 
sanctions of this nature.  There is in the process of evaluating 
proliferation issues, a constant effort to take a look at information, 
evaluate it, and determine whether relevant U.S. law applies.

          Q    Will these sanctions affect export of commercial aviation 
products -- aircraft or components?

          MR. McCURRY:  They could conceivably, in the case of China, if 
they are items that are on the Annex list and if they are items that are 

          Q    Are you going to be releasing that list later -- the 
Annex list?

          MR. McCURRY:  The MTCR Annex list is, I believe, a public 

          Q    Mike, you alluded earlier to the -- you just sort of 
touched, in passing, on hoping that the United States can still work 
with China on a wide variety of other issues.  What other -- did the 
Chinese respond, in their meeting today, to the United States by 
suggesting any action China would take in response to this matter on 
perhaps an unrelated issue?

          MR. McCURRY:  I think that the two ambassadors, or rather the 
Ambassador from China that the Under Secretary met with today, took this 
information, asked for some clarifications, responded somewhat, but then 
said that they would be conveying this information to their government.

          What I meant about "working together on things" -- Under 
Secretary Davis did offer to both the Pakistanis and the Chinese, in 
these meetings today, the opportunity to work together, to examine this 
issue in the future during the next two years to see if we could resolve 
our concerns and comply with the goals of U.S. export laws.  So that 
offer stands, and we are willing to work with them to seek any new 
information, or to evaluate any new information that's made available; 
and the offer to, in a sense, work with them on this particular issue is 
a genuine one.

          Outside this proliferation issue, we have a wide range of 
security concerns, economic concerns, trade relationships, cultural 
exchanges -- things like that -- which, of course, we would hope will 
continue and would reflect the positive aspects of our bilateral 
relations with both China and Pakistan.  But on this issue, on this 
particular matter, the U.S. law is clear, and we have enforced the law 
as we are required to do.

          Q    New subject?

          MR. McCURRY:  Anymore on this?

          Q    Another question on China.  There are reports that the 
United States had agreed to sell four E2C Hawkeye early warning aircraft 
to Taiwan.  Can you confirm that report?

          MR. McCURRY:  I can't confirm it.  I'm not familiar with the 

          Q    Would you please take that question?

          MR. McCURRY:  I'll take the question and see if I can get 
anything on it.  I can't promise that we will unless it's something that 
we've talked about publicly.

          Q    Mike, can you be more specific about exports that are 
covered?  For example, do the sanctions directly or indirectly cover a 
long-pending supercomputer sale?

          MR. McCURRY:  I can't be that specific.  I think, again, it 
goes back.  If it's a pending contract and it relates back to items that 
are specifically covered under the Annex, they would have to be 
evaluated.  Presumably, a U.S. manufacturer would apply for a license if 
the manufacturer believed it was not an item that is covered under the 
Annex list; and then that would be studied by either the State 
Department, in the case of a munitions list question, or the Commerce 
Department in a dual-use question.  It's just impossible to speculate 
freely on how it might affect pending transactions.

          As I said, the information I have is that the principal impact 
of this will be in the area of satellite technology and satellites that 
include U.S. manufactured parts.

          Q    Still on the subject of China's proliferation.  Have you 
got an update for us on the Yin He and its contents and its inspection, 
and so on?

          MR. McCURRY:  I don't have anything new on the Yin He.  I 
can't remember if it has arrived in port or if it's still making its way 
to port.  As of Monday, it was a 40-hour journey, and it was expected in 
port, I believe, some time today; but I'll check and see if there's 
anything new.

          We will, presumably, be getting reports from Dammam when we 
know anything more about the inspection that's going to occur.

          Q    Did the Chinese convey any further information upon their 
further reflection on what the contents of that ship might be?  Did they 
convey anything to the United States that sheds any light?

          MR. McCURRY:  Not in the contact related to this issue that 
we've been talking about, as far I'm aware.  I think probably different 
diplomatic people have been working on that.  I'll double-check with Dr. 
Davis and make sure.  You might want to pose the question to her later 
on, if she has anything new on that.

          Q    That applies to missiles which have a range of beyond 300 
kilometers.  But M-11 is only 300 or less?

          MR. McCURRY:  The question is really about the capabilities of 
the missile itself, and that would be among the questions that we pose 
directly to China and to Pakistan -- the specific capabilities of the 

          Q    The Pakistan Foreign Secretary is arriving next week.  Is 
this going to be a major issue again?  What are the other things --

          MR. McCURRY:  We've been working with the Government of 
Pakistan for some time on this issue.  We certainly would not expect 
this to dominate the discussion.  There are a wide range of issues that 
we have under discussion with Pakistan; but, certainly, proliferation 
issues -- regional proliferation issues -- will be among the things that 
are discussed.

          I don't want to make light of the importance of this 
determination today, but I would say that there are a broad range of 
things that are involved in our bilateral relationship with Pakistan 
that will surely be under discussion -- and I will try to get you more.

          The Indian Foreign Minister is here today and conducting 
important meetings here as well.  As I say, they are going on at the 
moment and I just hadn't had a chance to get any detailed follow-up from 
the people who have been participating.

          Q    When you talk about $400- to $500 million worth of 
impact, it is your assessment that 99 to 100 percent of that impact is 
on potential U.S. sales to China.  There is zero in the Pakistan 

          MR. McCURRY:  I don't want to say zero.  I was told very, very 
little impact on Pakistan because transfers of this type of technology 
and these types of items are already very minimal to begin with.  So the 
substantial impact is on China.

          Q    On a related matter.  Do you have anything new on the 
discussion of Han Dongfang and his diplomatic -- his passport status 
with China in the last couple of days?

          MR. McCURRY:  No.  I think, as you know, we registered a 
fairly strong protest and made a fairly strong statement about it 
earlier in the week, but I'm not aware of any further information on it.  
I'll double-check and make sure.

          Q    How would you characterize U.S.-Chinese relations now, 
given these various incidents that have been brought up today?  Are 
relations tense between the two countries?  Are relations deteriorating?

          MR. McCURRY:  We have a productive relationship that covers a 
wide range of issues, but there are clearly rocky points in the 
relationship.  Obviously, we're dealing with one of them today.

          Q    Mike, a related question to the proliferation, this 
transfer of weaponry?  It relates to what you said on -- the question 
you were asked on Monday -- about the transfer of weapons from North 
Korea and Russian aircraft to Syria, and you said something about you'd 
have to find an answer for it some time?

          MR. McCURRY:  I didn't get anything very interesting in 
response to my inquiry.  I see Mr. Balman here.

          Q    Well, look, the Prime Minister of Israel mentioned this 
publicly two weeks ago, in Israel, that there was this transfer.

          MR. McCURRY:  I don't want to comment on the Prime Minister's 
comments.  They obviously have access to information that they collect 
on their own.  We're just not prepared to comment on the report, the 
knowledge of which may be based on sensitive intelligence methods.

          Q    I don't mean to minimize the issue -- minimize your 
response.  But this sounds like a cop-out.  Here it is, the Prime 
Minister of Israel saying that Russian aircraft transported North Korean 
Scud parts to Syria.  Syria is a participant in the peace process.  
Russia is a sponsor.  This is quite important to those who are following 
the peace process in the Middle East, and yet the State Department will 
say, "We have nothing to say about it"?

          MR. McCURRY:  It's not true.  We don't say, "We have nothing 
to say on it."

          Q    You're not commenting.

          MR. McCURRY:  I think we frequently say we oppose the shipment 
of ballistic missile-related equipment to areas of instability, 
including the Middle East.  We've raised this issue with governments in 
the Middle East, with relevant governments outside the region.

          We were talking about an MTCR-related issue, and, clearly, 
this is something that falls right in the category of MTCR guidelines.  
But I should point out that the proliferation of ballistic missiles to 
the Middle East has been a source of concern which predates the peace 
process; and one of the purposes of the peace process itself is to 
alleviate the kind of tension that leads to these types of proliferation 

          Now, I will say this, since you're raising it in the context 
of being related to the discussion of this transfer -- and, again, I 
don't want to comment on the Prime Minister's remarks -- but we are 
dealing with sensitive questions of intelligence and information-
gathering in which you can't always be sure of what you're looking at 
and what you're trying to answer.

          So sometimes a country, as it evaluates information carefully, 
has to look long and hard at the question of what actually has happened, 
what actually has transferred, what actually was shipped.  That's the 
nature of these types of issues, as they are dealt with by any 
government -- that you have to look carefully and come to understand 
more of what you think has actually happened.  So beyond that, I don't 
want to minimize the importance of the question you're asking.  I'm just 
saying it involves information that we have to evaluate and look at very 

          Q    Isn't it fair to ask whether or not the Government of the 
United States is looking into this situation just as carefully as it has 
on the China-Pakistan issue, or --

          MR. McCURRY:  Yes, it's fair to ask that, and we are.

          Q    And you are?

          MR. McCURRY:  Yes.

          Q    (Inaudible) on the Middle East already --

          Q    Just to follow up on that issue --

          Q    Can I do one more China question?

          MR. McCURRY:  Let's end on this and follow with Sid.  It's 
your question.

          Q    So just to clarify, the Administration is exploring this 
case of the transfer of Scud missile parts to Syria, in terms of MTCR 
sanctions against both Russia and Syria?

          MR. McCURRY:  No, no.  You're reading more into what I said.  
I said that we look at these proliferation issues, as they impact on the 
Middle East, regularly and raise with governments in the region and 
governments outside the region our concerns.  That's as much as I want 
to say, because I can't accept the premise of your question about the 

          Q    To try to put the U.S. Government decision today into 
some kind of context -- as difficult as the decision may have been for 
the U.S. Government to reach and as painful as it may be for some 
American manufacturers -- in the context of the trade relationship 
between the United States and China, it is a tiny, little fraction of 
the business which goes on between the two countries and virtually has 
no impact on the trade relationship with Pakistan.  So it is less than a 
slap on the wrist when you view it in the context of the overall 
economic relationship between the two countries.  Can you comment on the 
scope or the magnitude of this?

          In some respects, it doesn't appear to be quite as serious as 
you are making it?

          MR. McCURRY:  I don't want to do that for this reason:  the 
effect of the sanctions and the dollar value of the imposition of 
sanctions, and that sort of thing, is something that, by law, we are not 
permitted to consider in reaching a determination of this nature.  In 
effect, as you look at the law -- as the law is written by Congress -- 
it doesn't matter whether the impact is small or big.  You have got to 
enforce the law the way that Congress has written it.

          In fact, it's specifically part of the statute itself that you 
can't consider the economic impact of a decision like this as you look 
at the determination.

          Q    Now that the determination is made, what is the impact?  
What percentage of U.S. exports to China are comprised of the categories 
that are now banned for the next two years?

          MR. McCURRY:  As I say, we're estimating what the likely 
impact is.  But Jack is absolutely right that it's a fraction of what 
our overall commerce with China is about.

          But, again, I would suggest to you, we're dealing with 
Category II sanctions at this point.  The question that still exists is 
did a Category I occur?  We have to continue to look at that issue.  If 
you discover at a future point that a Category I transfer has been made, 
a determination has to be made under the law and additional sanctions 
have to be imposed.

          Q    But you talked earlier -- you didn't use the phrase 
"compartmentalizing," but you described this case as being one which is 
very carefully limited to these specific categories of technology, and 
that it's dealing strictly with Missile Technology Control Regime 
issues, and so on.

          Have the Chinese expressed to the United States, either to the 
Secretary or through other channels, that they will likewise treat this 
issue as a very highly compartmentalized one that will not affect other 
aspects of the  U.S.-China relationship and of China's relationship, for 
example, with the U.S. through the U.N. Security Council, and so on?

          MR. McCURRY:  They consider this a very serious matter.  
They've made that very clear to us in the exchanges that we've had with 
them.  But how they evaluate this in the full range of all aspects of 
our bilateral relationship, I just can't answer for you because it's 
something that they would have to answer themselves.

          Q    Did they indicate whether or not they would retaliate or 
consider retaliation?

          MR. McCURRY:  I don't know whether they did or not.  In the 
report I had on the meeting, I hadn't heard anything of that nature.

          Q    I'd like to ask you about a report in the Washington 
Times that the State Department is providing security training to 
members of the ANC.  Can you confirm that?  And can you tell us the 
nature of the training and the rationale behind it?

          MR. McCURRY:  At the request of the African National Congress, 
the State Department is providing security training for a small group of 
ANC officials who are responsible for the protection of Nelson Mandela 
and other ANC leaders.

          The ANC officials are receiving training in protective 
security.  The training is being conducted by the United States through 
the State Department's Bureau of Diplomatic Security.  The training 
began on August 23.  It's scheduled to run through September 3.

          We have been in contact with the South African Government 
about that and expressed our -- we informed them, through the proper 
channels, that we are going to conduct this training; and it's clearly 
related to our desire to be of help in an area of the world that has 
suffered violence and in which the participation of leaders like Nelson 
Mandela is very important for the future prospects for peace.

          Q    Where is the training taking place?

          Q    How small a group?

          MR. McCURRY:  I don't have anything on the numbers involved.  
It's just a small group of ANC officials.

          Q    Where is the training taking place?

          MR. McCURRY:  I don't have any information on that.

          Q    Is there any precedent for providing such training for a 
non-governmental organization?

          MR. McCURRY:  I don't know.  I tried to get an answer to that 
question earlier today.  No one knew off-hand.  There was some 
speculation that there had been some similar type of training in the 
past involving a couple of cases, but no one seemed to know that with 
any certainty.  If I find out anything further on that, I'll let you 

          Q    (Inaudible).

          Q    Is the U.S. convinced that there is a threat to leaders 
like Nelson Mandela and others?

          MR. McCURRY:  They work under conditions in which violence is 
a part of their daily lives.  Maybe I'll just leave it at that.

          Q    Do you have any further information about responses from 
Middle Eastern parties to their participation?

          MR. McCURRY:  Nothing further.  We haven't had exact 
confirmations from the parties.  I'm told that I can reliably report 
that we fully expect all of them to be here and negotiating next week.

          Q    So you are sure of the talks taking place and the time 
fixed for now?

          MR. McCURRY:  We have not received formal confirmation from 
the delegations, but we expect all the parties to participate.

          Q    Which day do you expect them to come?

          MR. McCURRY:  It's actually because of the question of when 
there might be a Muslim holiday -- it's a little bit up in the air.  It 
probably will be the 30th or the 31st.

          Q    Can we switch to Bosnia, with everyone's permission.

          MR. McCURRY:  Bosnia.

          Q    The other day you agreed to take a question, I believe, 
on what the United States position was on imposing a deadline for the 
parties to agree to a settlement?

          MR. McCURRY:  I had a good conversation with Ambassador 
Redman.  I said, "At any point, in our contacts with the parties, have 
we indicated that we acquiesced or encouraged the imposition of a 
deadline in the discussions," and he said, "No, it's something that the 
mediators themselves had devised as a way of trying to advance the 
discussion of a political settlement, and we didn't take a position on 
the tactic of setting the deadline.  But we were aware of it, because of 
our contacts with both the mediators and the parties themselves."

          Q    It's reported over the weekend that the State Department 
team investigating the death of Fred Woodruff now believes that it was a 
random act of violence and that there is still some doubts among some 
people that there may have been some assassination.  What's your reading 
on that?

          MR. McCURRY:  There's been some speculation -- I would kind of 
call them "conspiracy" theories -- advanced in various places.  All I 
can tell you is that when I last checked on this, the team that we had 
over there -- which included law enforcement folks from the FBI, from 
the Diplomatic Security Bureau here, and people who are experts in 
forensics and other issues -- had been there.  They had gotten good 
cooperation from the Georgian Government in conducting their own 
investigation.  They were going to come back here and do a thorough 
workup on some of the forensics that they had developed themselves and 
then at some point give a full accounting of what they had learned over 
there.  That, to my knowledge, has not happened yet.  But I will check 
again on it.  I've asked to be kept apprised of when they've actually 
completed their own analysis of the information that they gather.

          Q    In terms of the preliminary indications, though, do you 
have something specific on it?

          MR. McCURRY:  I don't want to say anything about the 
preliminary indications, but I haven't heard anything yet that is 
dramatically at odds with some of the public accounts that you've seen 
in the news reports already.

          Q    Mike, do you have an explanation for this resettlement 
program in which the taxpayers are apparently paying for the 
resettlement of Iraqi POWs?

          MR. McCURRY:  I haven't had a chance to look, David.  I 
haven't had a chance to look, in any detail, on that.  There's some 
pretty thorough guidance that has been developed by our refugee program 

          I'll take the question and see if we can post this, because I 
just haven't had a chance to go through it in any great detail, but it 
looks fairly elaborate.

          Q    A question on Azerbaijan, Michael?  Are we trying to get 
-- are we launching a new initiative to try to get President Elcibey 
back into Baku and try to strike a compromise with the de facto 
authorities in Baku?

          MR. McCURRY:  I am not aware of any new initiative in those 
lines.  The CSCE Minsk Group is going to reconvene on Monday, and they 
will be talking about the next steps that exist in the peace process.  
It's clearly something that concerns us both because of the humanitarian 
impact of those who have been affected by the fighting and because of 
the fighting itself.

          I know it's on the agenda for Monday when the Minsk Group 
reconvenes .  I don't want to suggest too much about where we think the 
negotiations are going to go.

          Q    Does the U.S. Government still consider Elcibey as being 
the President?

          MR. McCURRY:  He's only the democratically-elected national 

          Q    And we are not trying to strike a compromise with Aliyev 
to get him back into some sort of power in Baku?

          MR. McCURRY:  Again, I'm not aware of anything on that.  I can 
check further for you on that.  I'm not aware of any effort of that 
nature, though.

          Q    Mike, has there been any hot tips in the Kansi hotline 
since it was announced a couple days ago?

          MR. McCURRY:  Have we had any response on that?  I don't know 
the answer to that.  I can check and see if we have.

          That has been a productive way of gathering information.  We 
have had tips and leads develop, but sometimes we can't share with you 
publicly what those leads are because they have to be appropriately 
investigated by law enforcement officials.  But if there's anything we 
can say on whether we've had a response after publicizing the 
availability of those rewards, I'll certainly do so.

          Q    Mike, just a clarification on China.  Could the 
Administration, if it chose to, have imposed stiffer penalties for this 
violation?  Or is it just all laid out in the law with no latitude at 

          MR. McCURRY:  It could have imposed Category I sanctions had 
there been a determination that a Category I transfer had occurred.

          Q    But given the determination that was made, was there an 
option to impose any stiffer penalty?

          MR. McCURRY:  No, no.  Given the determination made, the 
sanctions themselves are specified in law.

          Q    Is Pakistan being put under review for support of 
terrorist activities?

          MR. McCURRY:  Is it being put under review?  I'm not aware 
that it's being put under review.  I think that was a question that we 
examined earlier in the year as it related to the terrorism list.  I 
think you're aware of the decision that had been made by the Secretary.


          Q    At least last I checked, the convoys toward Mostar had 
not gotten through although the Croats, I believe, were saying that they 
would let them through.  Also, we're getting reports out of Brussels 
that NATO diplomats are clearly mentioning this situation in terms of 
military action.

          Are we giving further warning?  Is NATO trying to give a 
military warning to the Croats about the strangulation of Mostar, shall 
we say?

          MR. McCURRY:  I can't speak for NATO because I just frankly 
don't know if -- I'm not aware of any steps NATO has taken relating to 
Mostar.  I can say to you that we and others have expressed very 
directly to the Government of Croatia our very strong concern about the 
situation in Mostar and underscored the seriousness of the situation 
there -- clearly directing it to the Government of Croatia because we 
believe they have some measure of influence over activities that occur 
around Mostar by Bosnian Croat factions.  We have made our views very 
clear to them, and they know and we know the serious implications 

          Q    Are economic sanctions still under active consideration 
at the United Nations?

          MR. McCURRY:  I believe active, but no more active than when 
we talked about it earlier --  which is to say they're not at the point 
of drafting a formal resolution, to my knowledge.

          Q    Isn't it true that the U.S. is holding back, actually, at 
the U.N. from pursuing sanctions against Croatia now for fear of 
interferring with the negotiations in Geneva?

          MR. McCURRY:  I'm not aware of that.

          Q    That's what U.S. diplomats are saying at the U.N.?

          MR. McCURRY:  I'm not aware of that.

          Q    Thank you.

          MR. McCURRY:  You're welcome.

          (Press briefing concluded at 2:12 p.m.) 


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