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NOVEMBER 2, 1994

                       U.S. DEPARTMENT OF STATE
                         DAILY PRESS BRIEFING

                               I N D E X

                      Wednesday, November 2, 1994

                             Briefer:  Michael McCurry

   North African Development Bank/View of US/
     Others ........................................1-4

   Discussions on Peace Proposal ...................4,6-9
   Military Action .................................4-8
   UN Resolution to Lift Arms Embargo ..............9

   Summit of the Americas ..........................10-11
   NAFTA ...........................................10

   US Visa for Vladimir Zhirinovskiy ...............11-12


DPC #156


MR. McCURRY: Good afternoon, everybody. No prepared statements, just a lot of pre-briefing festivities.

Q Let me try to get from you the precise position that you have found Saudi Arabia, Morocco and other Arab countries on the Middle East Development bank, because there's one newspaper that thinks your idea is dead. Most of us don't think it's dead.

MR. McCURRY: I think most of us are right, and there's one news organization that was just flat-out wrong, and I don't know why. It wasn't for lack of trying. We did try to make sure The New York Times understood what happened. It's very clear from the communique itself. The communique -- those of you who were with us -- know that it said exactly what we wanted it to say, which is that a group of experts are going to look at how to create this Middle East-North African Bank for Cooperation and Development, and it's going to take some time to structure that bank. Why? Because, remember, the President of the United States, when he spoke to the Jordanian Parliament, said that this bank had to be properly structured.

It's our view that it has to be properly structured, and we found in our meetings that a lot of governments in the region share those concerns.

You'll recall Monday the Secretary met with Ministers of countries from the Gulf Cooperation Council that said right on the spot that they would be willing to buy shares in the bank and participate, and other governments said that they were fully prepared to do so. But they were doing some more checking.

Others said they were fully supportive of the conference communique that experts should look at it, but they had some reservations. We said we understand; we've got some reservations, too.

Q And the Saudis are in that last group.

MR. McCURRY: I would leave it to the Saudi Government to describe their position, but you're right. (Laughter)

Q But they're worried about duplication in this sense.

MR. McCURRY: Right. There are questions of capitalization; what type of lending arrangements will be made. This is a technical exercise in establishing and creating a bank. But it was a very important achievement that the conference declared that they saw the creation of a bank as an important element of a strategy for economic cooperation in the region. It was enormously important that those governments represented at the conference signed on to that, including all of those governments which, according to The New York Times, were blocking the plan for the Middle East Bank. That is just flat-out wrong. There's no other way to say that.

I don't know I guess you get on the front page if you write stuff that's not true. I guess that's the way it works. Is that the way it works?

Q But is it fair to say the Saudis -- one of their -- I mean, duplication -- they said there are other mechanisms.

MR. McCURRY: There are other lending institutions, and among things that experts could look at is how you calibrate, coordinate with other lending institutions, even with private banks, private investment. I think there are lots of questions like that, but we never claimed that all of those questions ought to be resolved during the course of the Casablanca Conference.

That's exactly why we recommended that there be a follow-on conference and why King Hussein of Jordan has graciously agreed to host the follow-on conference to the Casablanca Conference in 1995 -- the first half of 1995. That's when this group of experts will report.

The story said that the U.S. had hoped it would be included as part of the communique, as if it weren't. It's one of those frustrating things. And all of those of you who reported the story accurately, I have confidence that you got it right.

Q There are a couple of follow-ons, and I don't know if you have any firmer dates now. Something is supposed to happen in Washington. There's supposed to be a steering group. Do you have anything further on that? Are there any plans for meetings?

MR. McCURRY: Getting this expert group together, begin to structure it?

Q Yes.

MR. McCURRY: They're starting to do some work on that. I think they were waiting. The conference ended yesterday, so a lot of those people that we're participating in conversations with were headed back to their own countries. We will be following up on that and working out the arrangements suitably.


Q Mike, then there was no nation that said they just don't have the money to do it.

MR. McCURRY: There were countries that expressed concern about capitalization requirements, about lending arrangements. There was a lot of discussion of that, but there was no one that said, "Forget it, we ain't going to do it." That's the important point, the fact that every country expressed some willingness to entertain the idea. And, as I say, two countries went so far as to say that they would be willing to buy shares in the bank. Others said that they would be fully supportive.

This is an idea in genesis and ready to move into a more formal conversation about structuring. That's exactly where we said it would be, that's what in fact our goal was in the conference, and we're delighted we achieved that goal.

Q But, Mike, would you stop beating around the bush and tell us how you really feel about the stories? It doesn't seem like you did strongly enough.

MR. McCURRY: I don't want to be obnoxious about it. (Laughter)

Look, you pick up a great newspaper, and you read it, and you sort of -- you know, you want to believe that there is some element of truth to what you read.

Q Mike, there were people who spoke -- government officials, Arab officials, who spoke on the record confirming exactly what the story reported.

MR. McCURRY: I didn't see that in that article. I didn't see that. In fact, once you get beyond the headline and the lead, you can't find a lot to support the headline and the lead. That's why it was sort of aggravating, too.

All right. That's enough on that. That's beating a dead horse.

Q Mike, can we ask you about Bosnia?

MR. McCURRY: Yes, please.

Q There seems to be a growing divergence between the position of -- or several positions between that of NATO and that of the United Nations, but also between the United States and other members of the Contact Group.

Is this, do you think, an accurate perception of the way things are going?

MR. McCURRY: No. I think there has been a lot of work within the Contact Group. There are some differing views on questions like lifting the arms embargo; like strict enforcement around exclusion zones. But they are nuance views, and if you step back from that and look at the broader picture, the broader picture remains the same. There is only one way that this terrible conflict is going to come to an end, and that's through a settlement that's agreed to by the parties.

The parties, with the exception of the Bosnian Serbs, have agreed to a peace settlement plan, and the Contact Group and everyone else in the world community and now including in some measure the Serbs in Belgrade agree that pressure has to be brought to bear on the Bosnian Serbs to get them to accept that map, so that a peaceful settlement can be brought to end the conflict. Those are the broad contours of the discussion, and there's not much variance in the points of view of the United States and other members of the Contact Group on that central strategy.

There are some tactical things that are admittedly a source of differences, but we think we can work those out, and that's exactly why we're consulting with other governments on it.

Q In this pressure that you talk about, would you include the current Bosnian-Muslim-Croat offensive against the Serbs? Is that the kind of pressure that you want to see?

MR. McCURRY: It is up to the Bosnian Serbs to reveal how pressured they feel, based on things that the Bosnian Government itself is doing. But the military activity underway is certainly a reflection of the frustration that those who accept the peace plan feel that the Bosnian Serbs remain so intransigent. And it frankly is a source of concern to us that over time people will begin to think that there's some measure of victory that comes from the battlefield. There is not. The only way that people's lives will be saved and the killing can end in Bosnia is for there to be a peace settlement that the parties implement in good faith.


Q Mike, sort of on that topic, how does the Administration feel about the Croats throwing in with the Bosnians in the fight?

MR. McCURRY: The Bosnian Croats and the Bosnian Government have a variety of military contacts that are established and structured under their Federation agreement, and those two governments need to speak to that. I'm not in a position to speak to military arrangements they may or may not be making at this point.

Q Let me just follow. I'm talking about the Croats now fighting against the Bosnian Serbs. Isn't that exactly what you all envisioned with this confederation?

MR. McCURRY: We think military contacts between the Bosnian Croats and the Croatians and between the Bosnian Government and the Bosnian Croats are foreseen as part of the structure of the Federation agreement that was reached.

But, setting that aside, fighting at this point in Bosnia is not in any way a good thing. Fighting is a bad thing, and that's what we're trying to bring to an end.

There are reasons for it. There are reasons that it might in fact bring pressure to bear on the Bosnian Serbs. I think that's all been covered for you in recent days, but the killing and the enormous consequences and toll of this conflict is precisely what the Contact Group is trying to bring to an end.

Q That seems to be a little bit of a different message than your colleagues were sending in the last couple of days when the Muslims were advancing in their fight, and the United States essentially condoned and supported the Muslims' advances and even suggested that this kind of victory may have an influence on the Serbs to bring them to the table.

MR. McCURRY: If I recall the statements correctly, they suggested that that might be a form of pressure on the Bosnian Serbs which is, remember, the party that has not been willing to accept the plan; and for that reason you can understand there are legitimate reasons why the Bosnian Government might think that they need to try to advance certain objectives on the battlefield. And I believe we covered that in the last couple of days.

That's an analysis of what the impact of this fighting is. But stepping back from that and taking a look at the broader picture, I'm just suggesting to you that the lingering war does no one, especially those in Bosnia, any good. And that is why our objective remains the same. It is to get the parties to accept this proposal and bring the conflict to an end.

Q Mike, help me out. I don't understand. Why would it not be a good thing for the Bosnian Government to regain its territory?

MR. McCURRY: I didn't say that.

Q Through force or otherwise.

MR. McCURRY: Sid, the way to regain their territory or some measure of it is to accept the map that's been drawn by the Contact Group proposals. It's better to do it that way because a lot fewer people are going to die; there's a lot less danger to civilians, a lot less danger to people in the eastern enclaves, including Gorazde where the Serbs are now shelling, most likely as a result and retaliation for what's going on elsewhere in Bosnia.

The point is a peaceful settlement of this conflict is preferable to fighting on the ground and trying to gain through military means what in a sense could be gained instantly through acceptance of the peace settlement.

Q Have any of the Europeans expressed concern to the United States that some of those statements over the last few days might be too encouraging to the Muslims?

MR. McCURRY: I don't know. I would have to check on that. There has been an opportunity for that, because there's an ongoing dialogue with those governments through the Contact Group.

Q Have the Bosnian Government or Croatian forces done anything recently in this offensive in the U.S. view that calls for some NATO action against them? They've been threatened by General Rose, and I'm not sure -- I mean, the Secretary didn't seem -- he said there was no occasion for it. That was a couple days ago.

MR. McCURRY: The Secretary addressed that question. I don't have any view that's different or newer.

Q And nothing has happened in the two days since the change.

MR. McCURRY: Not that I'm aware of, no.

Q Mike, we asked a related question yesterday and didn't get an answer, and it relates to this, in that does the United States have the right to refuse to participate in a U.N.-called airstrike on the Bosnian Muslims. Is that something we can do and essentially veto a U.N. request for a strike against the Muslims?

MR. McCURRY: A U.N. request for a strike.

Q Against the Bosnian --

MR. McCURRY: Against the Bosnian Government, or anyone, goes through a dual chain of command structure that is a NATO chain of command, and we participate in NATO decisions. I'm not aware of a way in which an element of a NATO force such as those participating in cooperating with UNPROFOR and carrying out some of the mandates of both the U.N. and the North Atlantic Council, I'm not aware of a procedure by which they opt out of that if it's an operational plan that is place. I'm not the right person to answer that question. That's really a Pentagon question.

Q So apparently the bottom line is, if the U.N. does call for an air strike -- request a NATO airstrike against the Bosnian Government troops -- we have no choice but to do it?

MR. McCURRY: No, that's not true. There's a NATO chain of command, and that's a decision made by NATO commanders whether or not to execute. It's a dual chain of command. That request is relayed instantly to NATO and NATO commanders decide when and how to execute the strike.

Q Mike, to a question I asked, I believe was yesterday, regarding the history of the Bosnian conflict. I don't believe I've ever seen where the Bosnian Serbs have ever backed down when attacked. They always retaliate. That's been their style. So this retaliation leading to escalation, leading to possible involvement of the Croatians in this situation, Mike, wouldn't it be the best policy on the part of the U.N., NATO, and this government -- our government -- to ask that the Bosnian Government stand down on their offensives?

MR. McCURRY: Some people have exactly the contrary analysis. There are a lot of people who suggest that when confronted by use of force -- in fact, in many instances, the Bosnian Serbs themselves have backed down. That was certainly one lesson that came out of the establishment of the Sarajevo exclusion zone. Our policy is our policy. I believe that people are well aware of that. People can criticize that as you suggest they do, and it's all part of the debate about Bosnia.

Q Does the United States think that the United Nations is giving the Serbs too free a hand in Bosnia? There have been some reporting lately about that.

MR. McCURRY: That's kind of a broad characterization. We have had concerns about the ability to NATO to carry out missions assigned to NATO by the North Atlantic Council. Since those missions require very close coordination with the United Nations, NATO has met directly with the United Nations to establish some procedures.

This grows out, a lot of it -- I'm sure you're aware of Secretary Perry's meeting with other NATO Defense Ministers in Seville in which they structured some new proposals. Those have been under discussions between the U.N. and NATO, and there have been some changes and modifications made. That's, I guess, the generic answer.

Q Can you deal with, really, sort of the central issue there, which is to say, do you think the U.N. is too inclined to be understanding, sympathetic, preferential toward the Serbs?

MR. McCURRY: I'm not going to make a sweeping generalization. I think there have been some specific concerns that have been raised directly in conversations between NATO and the United Nations. They try to address that. I'm not going to try to characterize broadly the full range of UNPROFOR activity on Bosnia in that fashion.

Q Has the United States let it be known to the Serbs that if they accept this Map, this peace plan, that they could confederate eventually with Serbia?


Q Another topic?

Q No. On Bosnia, if I can stay for a second. To the U.S. view on the U.N. and UNPROFOR, in a different direction if I might, is there any view, since things have not stopped, since fighting still goes on -- notwithstanding the efforts of UNPROFOR and the efforts of the Contact Group -- is there any view on the U.S. Government's part that it might be better resolved not to have UNPROFOR there?

MR. McCURRY: UNPROFOR does very important work in keeping people alive and protecting those areas that have been designed safe areas by the United Nations. Their presence there, arguably, makes the situation better rather than worse.

At the same time, we recognize that as we proceed to other options that are our last resort -- specifically, lifting the arms embargo -- there comes a point in which UNPROFOR likely withdraws or removes itself because many of the participating countries that do have troops on the ground say that they won't leave them on the ground under those circumstances. There might come a point in which UNPROFOR ceases to be part of the solution. But that would be as a last resort because it's become unavoidable and it, frankly, would be less optimal than getting an agreement on the peace settlement now that would leave UNPROFOR in place.

Q (Inaudible) in a different way. What is the U.S. position at this time on the prospect of the Bosnian Serb areas of Bosnia confederating in Serbia?

MR. McCURRY: We are pursuing a Contact Group proposal that addresses that question fairly specifically. Our view is that the Contact Group proposal, the structure embedded in the Contact Group proposal, as presented and ratified by the Ministers in Geneva, is the way that this conflict could come to an end now.

Q And that does not presume a confederation between the Bosnian Serbs --

MR. McCURRY: My memory is that it's not addressed in that fashion.

Q On a different subject?


Q Do you have anything to say about the Indian Government failing to notify us for four days that an American was kidnapped in New Delhi?

MR. McCURRY: I have not had time, Sid, since I've been back to look into that. I can look into that and find out if there was some lapse of communication.

Q There's a little more than a month to go before the Miami- America summit. Latin Americans here are being told not to expect not much if anything in the way of trade development -- trade policy. Is it still the Clinton's Administration's policy to go ahead with the widening of NAFTA? Does the U.S. Government favor a Western hemisphere free trade agreement?

MR. McCURRY: The United States Government favors free trade. We certainly think those free trade arrangements that are embodied in the NAFTA agreement with Mexico and Canada can help us understand the requirements of free trade as we move throughout the region.

We hear from a lot of the governments that will participate in the Summit of the Americas a very keen desire to talk about trade and investment issues in Miami. That will be an important discussion, and it will happen. But I'm not suggesting that the structure of any one free trade agreement is applicable in all cases. We have a desire to move out to expand the community of free-trading countries, especially here in this hemisphere. I think that will be a very large part of the discussion in Miami.

Q Is the goal of a Western hemisphere for a free trade agreement, as a whole, not being contemplated?

MR. McCURRY: I don't want to predict at this point. We're still at a stage in which there are a lot of preconsultations going on. There will be increasing contacts with the governments participating in the summit as we go through November and into the summit in December. I wouldn't want to predict that any one outcome is more or less likely than another.

But as a central premise, the goal of freer trade, liberalized trading arrangements and the opportunity for economies to grow is a central premise of this Summit and certainly a central objective.

Q (Inaudible) away from the generalized premise, when NAFTA was negotiated and signed, the country that was sort of next on the list -- and I think the Secretary has spoken about this -- was Chile. Now Chile is reportedly so frustrated with its inability to talk to the United States and get anywhere on this that they are talking to the other two NAFTA partners -- Canada and Mexico -- and are really just quite frustrated about the whole thing.

MR. McCURRY: There will be lots of opportunities to have conversations with Chile. I would note in passing that next week we will go to an APEC meeting in Asia in which Chile will participate for the first time as a full-fledged member of APEC. That will occasion an opportunity for a lot of discussion.

I think there will be other opportunities as well. These are in this government who are working directly on the status of free trade agreements who would better answer the question. I think in each case, we are attempting to move our economic interests forward, cognizant of the fact that other partners are advancing theirs likewise.

Q The Secretary, at the L.A. Times today, mentioned that he would be raising the Indonesia issue with -- I mean, the human rights issues with Indonesia. I was wondering if you could go into anymore detail about it?

MR. McCURRY: I can't at this point. You would be interested in what format or in what set of meetings that will happen.

Q Will he press these points, specifically?

MR. McCURRY: We raise these issues, as you know, as a regular feature of our bilateral contacts with a wide range of governments. I can't tell you at this point how we will do so in the case of Indonesia.

Q Do you have any plans for a briefing on this trip?

MR. McCURRY: We are looking probably at doing something on Friday.

Q How come the foreign press is being briefed today?

MR. McCURRY: Because the Foreign Press Center was available. If you want a briefing today, we can do it as soon as you want to do it. You want to do it sooner rather than later.

Q I would.

MR. McCURRY: My thought was, for those of you who are thinking of going, it would be more useful to have it as an advancer on Friday. I'm happy to reconsider that.

You say you're taking Friday off? Slackers! Slackers!

Q Just a follow-up on yesterday's word about Zhirinovsky's visa. Was the Secretary himself involved in making that call? And what reason did you choose not to use the foreign policy exemption to exclude him?

MR. McCURRY: Terry, I can't answer your question. He was certainly aware of it. (TO STAFF) David, was it Tarnoff or Talbott? Senior levels in the building. The paperwork came out our way on it. I don't know whether the Secretary had an opportunity -- he probably did pass on an opinion on it after studying the paper. The argument presented by those who looked at the decision, it would be hard to justify the foreign policy grounds in connection with the proposed visit of Zhirinovsky. That's the way the argument went.

Q Did the First Amendment come into play.

MR. McCURRY: That was a very strong argument. Terry asked specifically about the foreign policy exemption.

Q That's all you even were looking at at one point.

MR. McCURRY: No, that is not --

Q It was narrowed down to only the foreign policy issue.

MR. McCURRY: Not in the materials I saw.

Q We were told it was down to that.

MR. McCURRY: The First Amendment issues --

Q The only possible objection -- the only possible reason to stop it was supposed to be foreign policy which is so vague. I don't know how you could stop it on that ground.

MR. McCURRY: It was clear from those who looked at the decision that the standard of law that is required to provide that type of exclusion was not met.

Q Thank you.

MR. McCURRY: Thank you.

(Press briefing concluded at 1:03 p.m.)


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