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U.S. DEPARTMENT OF STATE
OFFICE OF THE SPOKESMAN
DAILY PRESS BRIEFING
FEBRUARY 24, 1995



                       U.S. DEPARTMENT OF STATE
                         DAILY PRESS BRIEFING

                               I N D E X

                      Friday, February 24, 1995


 Briefer:  Christine Shelly

DEPARTMENT
   Secretary Christopher Trip to Middle East ........1-2
   --Consultations re: Arab-Israeli Negotiations,
       Mid-East Peace Process, Iraqi Sanctions Regime
   Secretary Christopher's Condition ................2-3

MIDDLE EAST PEACE PROCESS
   Reported Remarks by Syria re: Syrian Track .......3-4

FRANCE
   U.S. Response to Minister Pasqua's Statements re:
     Allegation of U.S. Leaks to French Press .......4-5
   --U.S./French Relations/Exchanges ................8-9,10
   Allegation of U.S. Attempts to Prevent French
     from Selling Arms/Aircraft to Taiwan ...........5
   U.S. Decisions re: Departures/Assignments of
     Embassy Officials ..............................6-7
   CIA/State Response to Economic Intelligence, State-
     Supported Industrial Espionage, or Unfair Trade
     Practices, Against U.S. ........................7-8,9
   Overseas Security Advisory Council ...............8
   Allegations of Spying in Germany .................10-11

NORTH KOREA
   Neutral Nations Supervisory Commission ...........9

FORMER YUGOSLAVIA
   U.S/Croatia Contacts re: Withdrawal of UNPROFOR ..11-12
   --Possibility of U.S. Participation in
       Withdrawal ...................................16
   --UN Contingency Plans for Withdrawal ............16
   Contact Group Proposal ...........................11-13
   --Milosevic/Contact Group--Informal Discussions ..12-14
   Contact Group Meeting in Paris ...................12
   Report of 8-Point Russian Proposal ...............16-17

NATO
   Dialogue with Mediterranean Countries ............18

ALGERIA
  Prison Revolt .....................................19

EGYPT
   U.S. Response to Banning of Jerusalem Newspaper ..19

RUSSIA
   Read-out on Deputy Secretary Talbott/
     Deputy FM Mamedov Talks ........................20-21

CHINA
   Energy Secretary O'Leary/Deputy USTR in Beijing ..21-22


U.S. DEPARTMENT OF STATE DAILY PRESS BRIEFING

DPC #27

FRIDAY, FEBRUARY 24, 1995, 1:l3 P.M. (ON THE RECORD UNLESS OTHERWISE NOTED)

MS. SHELLY: Good afternoon. I'll begin with an announcement.

President Clinton has asked Secretary of State Christopher to return to the Middle East the week after next. The Secretary, who last traveled to the region in December l994, will consult with key regional parties about the current status of Arab-Israeli negotiations.

The Secretary will also hold discussions in the Gulf related to the peace process and to the maintenance of the Iraqi sanctions regime.

Recent events have tragically demonstrated that the enemies of peace continue their efforts to keep Arabs and Israelis mired in conflicts of the past. At the same time, those committed to peace have made it clear that they will not be intimidated and will work to find a way forward.

This Administration, in its role as a full partner, is determined to assist their efforts. Toward this end, the Secretary will be exploring ways to consolidate agreements already reached and to lay the basis for a foundation for future progress.

I'll be happy to take your questions.

Q What date did you say that was?

MS. SHELLY: I didn't signal a specific date. As is not unlike past announcements of trips, I don't have the exact date. It will be a departure in the range of the 7th or 8th of March.

Q What itinerary?

MS. SHELLY: I don't have the exact countries, except to say Middle East and Gulf. It hasn't been finalized yet. We'll give you the details of that as soon as we have it. I think I can tell you that it's likely to be the usual places. No surprise is expected at this point, but the itinerary is not finalized yet.

Q And, obviously, his health is good enough?

Q He himself is up to it, isn't he?

Q He's fine then?

MS. SHELLY: We certainly expect that it will be. Do you want me to give you what I've got on that --

Q We'd appreciate it.

MS. SHELLY: -- or go back to Middle Eastern things?

Doctors have examined the Secretary this morning. His condition is stable and he's progressing well. His hemaglobin is fine and his bleeding has stopped. He will be checking out of the hospital early this afternoon. He will be then traveling in his limousine in order to get on Air Force One and travel back to Washington.

Present plans are for him to go directly from Andrews Air Force Base to Georgetown Hospital. This is for observation along the lines of that which was indicated up in Ottawa last night. He'll be in Georgetown Hospital for one or two days. He will resume his normal schedule early next week. And other than being able to announce that he expects to travel to the Middle East as planned, I don't have any other schedule adjustments to indicate.

Q Will he make his major foreign policy address in the heartland next week, or the week after?

MS. SHELLY: I don't believe he will be making a speech at the beginning of the week, but he does have a couple of Congressional testimonies scheduled then. He's got a full schedule of other activities.

Q What was that speech supposed to be, do you remember?

MS. SHELLY: Well, there had been some preliminary planning about doing that early in the week, but in deference to the Secretary and just to make sure he's got a few days to get the things checked out that he wants to, we're going to be doing that but later in the month.

Q So he will not be resuming his normal schedule, because he's not going to do the speech.

MS. SHELLY: I would certainly say his plan is for him to resume his normal schedule. That was not something that we had made any formal announcement on, and we simply think that it's prudent to put that off for another probably couple of weeks.

Q Have the doctors suggested that he cut back on his work schedule?

MS. SHELLY: Not that I'm aware of.

Q What kind of doctors saw him, do you know?

MS. SHELLY: All that was in the press event which was done last night in Ottawa. We've got the transcript of that available.

Q He saw him this morning.

MS. SHELLY: Are you talking about --

Q This morning.

MS. SHELLY: Yes, his doctors saw him this morning, but there was an event up in Ottawa where his doctors -- the doctors in whose care he had been placed did a little thing with the press; and their titles and particular specialties are all available in that transcript.

Q Is the diagnosis still a bleeding ulcer?

MS. SHELLY: I'm not going to do the diagnosis from here. The information that we have on that we put out last night. The transcript is available in the Press Office.

Q Right, that was put out last night. Is the situation the same, whatever the diagnosis was last night?

MS. SHELLY: There is no information today that I'm aware of that changes any of the information regarding his condition that was put out last night, except to be able to tell you that he's making good progress today.

Betsy.

Q A different story?

Q Syria, apparently, got wind of his Middle East trip a little ahead of your announcement.

MS. SHELLY: Lots of people, I think, were anticipating the announcement for some days, if not weeks.

Q Anyway, Damascus radio this morning had some very pessimistic words to say about the Secretary's trip -- you know, the usual stuff: Israeli stubbornness; refusal to sign the NPT; Christopher, I mean essentially in so many words, is wasting his time; there can be no peace unless Syria gives back Lebanon and the Golan Heights.

Are these constructive comments from a participant in the peace process?

MS. SHELLY: Sid, I don't have any specific comment to make on those. The Secretary decides, based on his reading of the situation, when best he should make a trip to the region and then to go forward with those plans. That's what he decided to do. There are ups and downs in the process; we know that. But he also believes that his presence is important in order to sustain the process, and that's certainly been a factor in his decision to go.

I don't think it's particularly productive for me to get involved in a deep exchange on the Syrian track. We always listen to what the Syrians have to say, both publicly and privately, and it's a track in which -- as the Secretary said many times -- a considerable effort will be necessary this year in order to achieve the kind of progress we'd like to see.

Yes, Betsy.

Q Le Monde published another article this morning about the French spy back and forth, in which Monsieur Pasqua evidently said some things which greatly annoyed this government --

MS. SHELLY: The French?

Q -- and the statement was released in Paris. Can you fill us in on that?

MS. SHELLY: Yes. There's an article, which came out again, suggesting that the U.S. might have leaked some of this information. We regret these statements by Minister Pasqua. We categorically reject the allegation that we are responsible for the detailed leaks to French newspapers. The charge is entirely false.

For our part, we scrupulously respected our agreement to maintain confidentiality in this matter. We regret Minister Pasqua's inaccurate and incomplete account of his conversations with Ambassador Harriman.

In any event, these exchanges should have been protected by the rule of diplomatic confidentiality. Public discussions of their content was inappropriate.

Q Do you think he might have been the source of the leaks?

MS. SHELLY: I'm not in a position to make that call.

Q Will you be investigating the source of the leaks? Will this Government do something to investigate the source of that leak?

MS. SHELLY: Will our Government be investigating that? That's certainly something that I would not expect would fall under our jurisdiction. I think that's under French jurisdiction.

Q There's an allegation, out there now, from an allied government that we initiated the leak. Doesn't it, at least, merit taking a look at it?

MS. SHELLY: Sid, jurisdictionally, I think the issue of leaks and who put that information out is something that will be addressed in the French context. That's certainly also what the French Foreign Minister suggested yesterday. It's hard for me to imagine that we would be involved in any independent investigation of that.

Q Your statement said the U.S. has been engaged in detailed leaks. Can you take the adjective out and make the same statement? Has the U.S. engaged in any skimpy leaks? (Laughter)

MS. SHELLY: I'm not going to draw a distinction. We do not engage in leaks.

Q No. I know how it works and played with (inaudible).

MS. SHELLY: We do not engage in leaks.

Q Thank you.

Q They're having reports that a controversy was started because the U.S. was trying to prevent the French from selling arms, the aircraft and missiles, to Taiwan. Do you have any comment on that?

MS. SHELLY: No, I don't have any specific comment on that allegation.

Judd?

Q What is the status of the five people named? Are they still all in France?

MS. SHELLY: Yes. As you know, as I mentioned in the statement that I put out on this on Wednesday, there was not any request by the French for their expulsion, and that has not occurred. But the specific decisions regarding departures, timing of them and length of stay associated with their assignments at the Embassy, are decisions for us to make; and at this point I'm simply going to decline to provide details on that.

Q Do you know when the Americans come home?

MS. SHELLY: No, I'm not in a position to confirm that.

Q Usually you said that they would be following their normal rotation schedule. Is that still the operative case?

MS. SHELLY: What I'm saying today is that the French did not insist that these people be moved, and we're simply not going to get engaged any further on issues related to the dates of assignment and transfers.

Q Well, might they might come up and serve their normal tour of duty?

MS. SHELLY: Again, those decisions are ones that we'll make, but we're not inclined to get any further engaged in discussions of specific tours.

Q Is it conceivable that some of them might come back to the United States before their tour of duty is up?

MS. SHELLY: I'm not going to specifically rule that out, but I'm not going to confirm that that's what's happening either.

Q Well, Christine, isn't that a change from what you said the other day? Hasn't your position changed?

MS. SHELLY: If I said something on a previous day that was misleading, I regret that; but I think that we have all come to the conclusion, given the rampant speculation which is out there, that it's simply best not to get into a discussion of any of the specific tours of duty.

Q The Washington Post reports this morning that one was caught red-handed and is back. Can you at least, on that narrow matter, confirm or deny that story in the Washington Post?

MS. SHELLY: No. I simply am not in a position to engage on that one.

Q Christine, there's been a lot of talk about, somewhat, this is their retaliation for the U.S. doing a lot of things. The U.S. has been complaining that this is not the way these things are handled; that the U.S. should -- that the French should have done this all privately and kept it all quiet.

How do these things happen? How do these things -- what does the State Department do in handling this kind of thing in looking at potential economic spies or any other kind of spies?

MS. SHELLY: I think that's a very valid question. In fact, when the issue first arose on Wednesday, I actually enlisted those who are engaged in the general issues of economic interests of companies and American economic interests abroad; I asked them if they could try to work up something on that. I know there's a lot of interest.

I think, specifically, in the whole area of how we -- I guess the issues related to industrial espionage, economic intelligence, I think you're all aware that CIA Director Woolsey testified on this subject in some detail in January. So I have worked up a little bit of that, sort of keying off of his testimony but also insofar as how this involves the State Department when we feel that there are concerns or issues out there related to targeting against Americans.

So if I can take a minute to kind of walk through that. As I'm sure most of you are aware, in this testimony that CIA Directory Woolsey gave on the 10th of January, he stated that the agency engages in the gathering of economic intelligence defined as assessing international economic trends, providing briefings on such information to senior Administration officials, and supporting our trade negotiators.

As part of this economic intelligence-gathering activity, the Director acknowledged that the agency might make an assessment that a given country was violating the rules of international trade in one of two ways. The first would be by using its own intelligence services to engage in industrial espionage or by fomenting or supporting industrial espionage by its own companies; or the second way was engaging in unfair trade practices, such as bribery, corruption -- that type of thing.

In either case, the agency said that it typically brings such information to the attention of the State Department or possibly other agencies which then may seek to redress it in a variety of ways.

In the case of the State Department, the agency typically advises the State Department when it encounters instances of either state-supported industrial espionage or unfair trade practices and will seek our advice as to how and whether or not American companies are affected, and if appropriate -- if the relevant foreign government in question ought to be informed of that activity. It is generally the Department's policy to act on this knowledge whenever possible by alerting U.S. companies adversely affected.

Again, I would want to emphasize that this is a defensive or a reactive process. The intelligence community does not conduct industrial espionage to assist U.S. companies. But, as I said, it might make the State Department or other agencies aware of such practices directed against U.S. business interests; and where appropriate, we may make use of that information with the U.S. companies involved if they are the targets.

I might also add one additional thing, and that is that the State Department also chairs the Overseas Security Council whose governing Council consists of State, USIA, AID, and Commerce, as well as representatives of 21 of the Fortune 500 companies.

The Council's membership consists of about 1,400 U.S. private businesses with international business interests represented.

The State Department, through this Council -- through the Overseas Security Advisory Council -- routinely works with U.S. businesses to assist in the protection of proprietary information and also to help protect against industrial espionage and unfair trade practices.

Q Did the U.S. meet with French officials either here or in Paris today on this subject?

MS. SHELLY: On the general subject?

Q Yes.

MS. SHELLY: Not specifically that I'm aware of. We had some exchanges with the French regarding this latest newspaper article in which we registered our very strong complaint regarding what had appeared in the press today.

Q Can you tell us what their response was in that meeting?

MS. SHELLY: I can't comment on that specifically except to tell you that we had exchanges with them at senior levels in both places -- both Paris and here.

Q How would you characterize those meetings?

MS. SHELLY: How would I characterize that meeting?

Q Tense --

MS. SHELLY: I would characterize it as serious in tone.

Q Christine, has the Secretary talked with French Foreign Minister Juppe since this thing broke?

MS. SHELLY: Not specifically that I'm aware of. I don't believe he did on Wednesday, which is when he was last here; and then, of course, he's up in Ottawa for the last two days.

Q If North Korea even try to oust the police delegation from the NNSC, what's the next counter-measure to maintain the peace on the Korean Peninsula?

MS. SHELLY: I'm sorry. The question is, if the North Koreans oust the Polish --

Q The delegation from the NNSC (Inaudible) Supervisory Commission. What is your next counter-measures to maintain the peace (inaudible) on the Korean Peninsula?

MS. SHELLY: It's my understanding that that hasn't happened yet; that the deadline is actually the end of February. So that puts it in the range, at this point. of a hypothetical question, so I can't comment on what might be a response.

I think you're aware that we put out a statement on this yesterday in which we protested vigorously the actions which had been taken by the North Koreans to attempt unilaterally to destroy the Armistice mechanism through a series of actions against those participating in the Supervisory Commission.

We also have conveyed this very strong feeling of ours to the North Korean Mission in New York as well. We are obviously watching the situation closely, and I think, certainly, our position on this was clearly stated and certainly has been received accordingly.

Q Can we go back to France?

MS. SHELLY: Sure.

Q On your comments on what the CIA sees its role in assessing industrial information, are we to assume or to conclude that at least some of those five the French have accused of industrial espionage were doing this kind of assessing?

MS. SHELLY: Again, I'm simply not in a position to engage on the allegations against the five people in question.

The general subject matter, of course, touches on issues related to the economic intelligence or industrial espionage area. But, again, I'm really proscribed from specific discussions of that.

But insofar as there is certainly a very strong interest in and concern with the subject matter, it is something that the State Department also does play a role in insofar as working with American companies and protecting their interests in this. That's why I thought it would be useful to at least to try to describe what our role is in this.

I had also gotten a question a couple of days ago about, did this represent any kind of new emphasis for the State Department, or was there some kind of tie in here about what embassies are doing overseas, in the context of the Secretary's emphasis on the -- or introduction -- of the "America's Desk" concept at the State Department. I can also go into it at a little greater length if anyone is interested.

But I'm simply trying to make clear what the State Department's interest is in this and to try to be able to describe it as an issue more generically.

Q How would you characterize U.S.-French relations right now?

MS. SHELLY: I think the most recent incidents have certainly created some strains in that relationship for the present, but I think we have a very longstanding and certainly overall cooperative relationship with the French on a very broad range of issues.

I wouldn't expect there to be a significant long-term impact of an adverse quality. I think the French interest in trying to keep the American-French relationship on track has also been signaled at fairly senior levels in the French Government; also in public statements over the last couple of days, and certainly by the French Foreign Minister.

Q There is a wire story that indicates that some elements in Germany have also said, "Well, the U.S. has also been spying on us, and so maybe we should start investigating that." Is this beginning to get out of hand?

MS. SHELLY: I think that the problems related with efforts by others to gain access to certainly proprietary business information and technology, that that is certainly out there as a problem.

I haven't seen the specific remarks that you're referencing, so I can't comment on them specifically. But I think it's certainly up to each nation to determine how best to protect the interests of its citizens and certainly also of its companies.

Q In the Balkans, there were a couple of questions. (1) Tudjman apparently is going to throw out the U.N. peacekeepers. Have you anything new to say about that? Has the U.S. made another attempt to dissuade him?

MS. SHELLY: The issue certainly is one in which we are devoting a lot of attention. Certainly, his position on this remains worrisome for us, and I think that the U.N., the participants in UNPROFOR and certainly us nationally are concerned about that prospect looming on the horizon, and with the end of March deadline coming up, although I think you know at the time that President Tudjman indicated that there might be some flexibility in the timing of that.

I think it certainly is very much our hope that that decision can be looked at again, and that there might be some way to try to keep a presence there that would not permit the resumption of hostilities in Croatia.

We're in almost daily contact with Croatian leaders regarding our concerns over Zagreb's decision to seek the withdrawal of UNPROFOR. We remain convinced that unless certain aspects of UNPROFOR's mission are preserved, that renewed fighting in Croatia and possibly beyond that could follow a UNPROFOR withdrawal.

We continue to believe that a settlement between the Croats and the Krajina Serbs is vital to Croatia's future. We believe that the proposal that we've talked about before -- Zagreb 4 -- it demonstrates to all sides that an arrangement is possible. The details for that arrangement are certainly for the parties to sort out among themselves, but we still believe that the Z-4 principles offer the best prospect at this point for a durable settlement.

Q And on the next-door, Serbia, has that U.S.- backed proposal to ease sanctions been presented to Milosevic directly, and what's the result, please?

MS. SHELLY: It's not a U.S. proposal.

Q U.S.-backed proposal.

MS. SHELLY: It's an initiative which was brokered in the context of the Contact Group.

Q You're willing to give the French credit, I know, for much of this these days, but it is U.S. supported and U.S. ballyhooed, and I wonder if it has been presented to Mr. Milosevic and what his response was.

MS. SHELLY: There hasn't been any formal presentation by the Contact Group to Belgrade. There was a meeting yesterday where Milosevic met with the EU members of the Contact Group. I would characterize this more in the nature of an informal founding on the issues that are in that initiative.

We expect to discuss the results of those meetings with our Contact Group partners today and probably in the next few days. I'm told that the tone in the meeting was a little more constructive on the part of Milosevic. He certainly is not -- I'm not attempting to mislead you on that. He has not embraced the initiative.

But he hasn't categorically rejected it either. I think he wants to study some of the ideas that have been discussed with him further and perhaps also take some days to consider the possibility of putting some of his own ideas forward.

The Contact Group will meet in Paris next week to review this meeting in Belgrade and to assess the next step to be taken. That's about all I can tell you, I think, at this point.

Q Has he been formally given this proposal?

MS. SHELLY: He certainly -- I mean, given the --

Q He reads the press, but --

MS. SHELLY: He certainly reads the press. I think it would be most unlikely that he wasn't familiar with most of the elements in it. But what has happened is that members of the Contact Group have been taking, I guess, informal soundings with him about ideas in it.

Certainly, the hope is to try to figure out some way to get over the obstacle which the lack of recognition of Bosnia and Croatia represents in the process, to try to find a peaceful solution to the problem. Of course, it also touches on the issue of the proposal put forward by France for an international conference, in which the recognition issue was -- it was hoped that that could be addressed in the context of that conference.

So these ideas are certainly still out there, and these ideas and formulations are what's been under discussion.

Q This almost mathematically clean and easy to -- and balanced equation of a proposal has become sort of scattered into ideas with summits. Look, the idea that -- we were told that what the U.S. was backing was telling Milosevic he can have relief from sanctions temporarily, and that could be extended in exchange for certain things, like recognition and permitting more monitors on the border.

Was that proposal in those terms put to the Serbian leader?

MS. SHELLY: Not formally as a single proposal. I mean, since much of this came out in the public domain prior to discussions on it by members of the Contact Group, certainly Milosevic could not have been unfamiliar with the idea of this and some of the steps that he would have to take in order to get any kind of temporary suspension of sanctions.

So the ideas are out there. I would not characterize it as a formal proposal which has been presented to Belgrade at this point, but I'm certainly not going to out-rule the possibility that the group may reconvene and go back there together to make a more formal proposal.

I think it's more in the context of there being -- certainly, he has gotten the gist of that the package is, including the elements that the Contact Group would like to see him take.

But I would say again it's still more in the category of ideas and proposals that are part of this initiative that have been tossed about, and the exchanges have been more informal than formal.

Q Is there any quarrel then from what you've just - - your description now -- would the State Department quarrel with the notion that the five countries, including the United States, have withdrawn, have abandoned -- have withdrawn a proposal to temporarily relax sanctions against Serbia if they would recognize four former Yugoslav republics and also permit more monitors on the border?

The it quid pro quo of it -- ideas out there and the fact that he can read and write is all very interesting, but you had a proposal, a balanced proposal, not just scattered ideas, including summit meetings, and God knows what else. Have you abandoned -- has the U.S. abandoned that proposal?

MS. SHELLY: No, we have not.

Q Well, why don't you present it to him?

MS. SHELLY: Because we also have to make decisions about how best we can have exchanges with Milosevic on the issues in question. And there was an attempt by the Contact Group some days ago when they all were able to be there at the same time to do this and it simply didn't happen at that particular moment. Milosevic did not indicate his readiness to receive the group for a more formal presentation.

However, as events have unfolded, he has demonstrated his willingness to talk about the elements in the proposal, and so this has simply been pursued more informally in the most recent days than it has been formally.

Charlie.

Q Just a follow on that point. Am I correct that in the last few days, last week or so, he has received Mr. Kozyrev, he has received the three European members of the Contact Group. That leaves one partner remaining not seen - - the United States.

I mean, has he just signaled that he's not going to accept it privately and therefore you didn't present it formally, so that he wouldn't have to reject it formally?

MS. SHELLY: No. I just think it's -- what's happened is that even though he made some public statements on it that were certainly negative, it certainly has not ended his willingness to consider it. So I think he is considering it, and if there is some cosmetic elements involved in the way in which he does this, so be it. The important thing is to try to work on the issue of mutual recognition and particularly the recognition by Milosevic of Croatia and Bosnia. To consider that, since we know he would like sanctions relief -- and that's something that he's keenly interested in -- to see if we can bring the process to a point where the recognition could take place in exchange for certain other actions on Milosevic's part.

Q Has Secretary Holbrooke had any contact with Milosevic?

MS. SHELLY: Not specifically that I'm aware of.

Chuck.

Q Is the Contact Group still unanimous behind this? Is there a problem within the Contact Group?

MS. SHELLY: Not that I'm aware of.

Q One follow-up question. Isn't time of the essence here? I mean, part of the motives behind this proposal is to make sure that if fighting does break out when UNPROFOR leaves Croatia, that Milosevic stays on the sidelines?

MS. SHELLY: That certainly is the hope, but it's also our hope to work at the other issues where the clock is ticking, such as obviously the withdrawal of UNPROFOR and to try to work on all of the different issues -- both the issues within Croatia, also the issues strengthening the Federation, and then also the issues related to the Serbian side of the equation and also obviously Milosevic's role in the conflict generally.

Q But, I mean, time is of the essence, isn't it?

MS. SHELLY: Yes, and I think that you are still seeing a continuation of the intense effort on the part of all those who are in the Contact Group to try to move the process forward. But it's not an easy process. We've never said that it was, and we've never suggested that results on this were going to be quick.

I think the point of greater concern would be if the Contact Group and its members were not engaged in discussions with an effort to try to move the process forward, that clearly is not the case.

Q The heart of the proposal stays the same. There's been no change in this back-and-forth discussion with Milosevic.

MS. SHELLY: The heart of the proposal to my knowledge remains the same.

Q Okay. Is it open to negotiation?

MS. SHELLY: At this point what's going on is not negotiation; it is discussion.

Q It's not negotiation.

MS. SHELLY: It's discussion.

Q If I can go back to Croatia just for a second. A week or so ago the Secretary said he couldn't imagine leaving UNPROFOR troops in the lurch. Has the United States taken a decision to help withdraw U.N. troops from Croatia?

MS. SHELLY: As you know very clearly from what the Secretary said from this podium, that this is a decision that would be taken by the President, and he had not taken that decision, and I'm not aware that a final decision has been taken yet.

But none of what we've said on that previously, which is that when NATO allies are involved in this and should they have needs and requirements in connection with a possible withdrawal, we would certainly expect to fulfill our obligations to them.

We have had under review options for our participation in what would be a NATO-led action to withdraw UNPROFOR from Croatia, should that be necessary. We obviously hope it's not going to be necessary. We will continue in our efforts with Zagreb to try to prevent the need for such a withdrawal.

Regarding the U.N. planning on this, they are preparing contingency plans for withdrawal, which is obviously prudent of them to do so. But I still don't have anything beyond that to share.

Q You said the United States is doing contingency planning for this withdrawal out of Croatia. Is that -- did I hear you correctly?

MS. SHELLY: I said the United Nations.

Q No, before that you said something about our contingency --

MS. SHELLY: I said that we had had under review -- continued to have under review our options for U.S. participation in a NATO-led action to withdraw UNPROFOR from Croatia, if that would become necessary.

Q The Serbian press has been carrying an eight- point proposal Mr. Kozyrev made which contains many of these elements. Have you studied this eight-point proposal that leaked in the Serbian press, and are you in agreement with this Russian proposal?

MS. SHELLY: I have not seen that report, so I'll have to check on it. It strikes me that it may be -- if it's not similar, perhaps it is in fact the same plan. But I'm not aware of there being any separate Russian eight-point plan.

Q Whatever the Russians are doing, they're linking any relief from sanctions to recognition is what you're saying, right? That's kind of central, isn't it? You didn't tell them to hold on for a lifting of sanctions and if you want to recognize Croatia and Bosnia later on, maybe you ought to think about it.

MS. SHELLY: Barry, it's up to the Russians to characterize what they said.

Q No, no, it's up to you to say whether -- State Department -- whether your trusted ally and a member of this five-nation group is proposing something quite different to Serbia. Do you have dueling proposals now?

MS. SHELLY: I certainly hope that we don't have dueling proposals. We said prior to Foreign Minister Kozyrev's going that we certainly expected and hoped that he would -- any action he would take would be consistent with the Contact Group proposal, and that certainly was our hope.

The result of the meeting certainly did not come out in a way that we had hoped or expected. I think we have already admitted that publicly.

Q On a different topic, please.

Q This one has to do with NATO and --

Q Did Kozyrev stick to the Contact Group plan?

MS. SHELLY: I think that I will reiterate what I said about the results of the meeting. I don't have a private readout on that to share with you. Certainly, the meeting did not come out in the way we would have liked.

Q Christine, one follow-up on that. The discussions are intense, the clock is ticking, we have a proposal, but now we're trying to work out how we're going to propose? Do we need a proposal about how to propose the proposal?

MS. SHELLY: No. In order to get the issues on the table for some kind of serious consideration by Milosevic, if the form in which those discussions take, in which the issues are discussed and aired and also considered -- if a different combination of countries or different sets of meetings -- any of those things are what facilitates the process, for whatever reasons may be behind Milosevic's decision to engage or not on the factor, I think it's only appropriate that the Contact Group would pursue the channels that they feel would be likely to be most productive.

So it had been our hope originally that the group would all be able to go in there together. That did not happen, so therefore -- but the same result, I think, which is to get some consideration of the elements of the initiative -- get it under Milosevic's consideration, I think that certainly has happened.

Q Christine, how long are the five great powers of this world going to play "slippery boy" for Slobodan Milosevic?

MS. SHELLY: Sid, I'm just not going to answer that.

Q It has to do with another NATO issue, and that is, under the leadership of Secretary General Claes, NATO held its first meeting today with some Middle East countries, dealing with the subject of Islam.

I wanted to get a sense from you, what has been the U.S. position to NATO on this particular initiative?

MS. SHELLY: To my knowledge, NATO doesn't have any position against the religion of Islam. What NATO agreed to do some months back -- at the December Ministerial, for example -- was to follow up on summit decisions which had to do with beginning a dialogue with some of the Mediterranean countries on a range of issues, including security issues.

I don't have any particular readout on what happened out in Brussels today. It's my understanding that the decision which was taken recently by the NATO Council was in implementation of the NATO December Ministerial, and that what is beginning as a dialogue with Mediterranean countries on issues of mutual concern.

Q What has been the U.S. position to this?

MS. SHELLY: The U.S. position? As one of the 16 members, where decisions are taken by consensus, is that we support this dialogue.

Q But the dialogue is -- one of the main issues is fundamentalism, isn't it, and terrorism and the fear in Europe that if Islamic Fundamentalists come to power in Algeria --

MS. SHELLY: My understanding is, it's not Islamic Fundamentalism, per se. It is the risks and threats which are posed by radicals and extremists who then would employ or could employ violence, or violent means -- terrorism -- in order to try to achieve their political ends; that it's the risks to security of those nations in the Mediterranean area which is what is going to be under discussion.

Q And the fear that if those radicals come to power, there may be immigration to Europe probably from North Africa?

MS. SHELLY: I think that's going fairly far down the road. What's starting now is simply the beginning of dialogues with the countries that they identified to be included in this group. The decision on which countries to begin a dialogue with was made in the NATO Council on its usual consensus basis.

Q Does the U.S. share the concern of the Secretary General?

MS. SHELLY: Which specific concern?

Q When he said initially, when this whole thing got started, that he viewed this threat as basically following up the next confrontation after the death of communism.

MS. SHELLY: I would have to go back and check the remarks specifically that you're referring to. I understand that the Secretary General did give some interviews which gave some insight, I think, into his thinking. I don't have the text of that before me. I addressed already the issue of what we think the dialogue is about, and that was certainly the form in which the decision was taken by the NATO Council.

Q Christine, speaking of violence and extremism, what does the State Department think about what the Algerian Government did the other day -- yesterday, or the day before -- at the prison? Do we have a fix on the number of dissidents killed, and so forth?

MS. SHELLY: I don't have a lot of information on that. We don't have independent information regarding the exact facts of the events at the prison. We're certainly deeply concerned, generally, about the deteriorating security situation and we deplore the continuing violence.

Because of the fact that we don't have independent information on that, I'm not in a position to make a judgment about specific numbers of deaths or other actions.

Q Another matter in the region. Do you have anything to say about Egypt's banning of the Jerusalem Post?

MS. SHELLY: Actually, I expected that question about a week ago. There's guidance in the Press Office. I must confess it escapes me what it said at the moment. I think what we said on that was that we were aware of the action and hoped a way could be found to get past the objections that had been raised because we certainly support freedom of the press and certainly circulation of newspapers of this type. You might check the --

Q Would it be possible to resurrect that guidance and distribute it?

MS. SHELLY: Sure. No problem. We'll work it up as a "taken question." How's that? It exists already. I know we can do that.

Q Could you summarize the outcome of today's discussions between Mr. Talbott and the Russian Deputy Foreign Minister?

MS. SHELLY: I've got a readout on that. The meetings between Deputy Secretary Talbott and Deputy Foreign Minister Mamedov were the latest in a series of periodic meetings that we have held with Mamedov over the past two years.

Deputy Secretary Talbott met with Mamedov in -- last met with him in Brussels in January.

As before, the talks covered a broad range of issues. The purpose of the Mamedov visit was to review the bilateral relationship and, of course, engage in discussions on a number of other issues. What the discussions focused on, probably most specifically, were European security issues, NATO enlargement, and the NATO-Russian relationship.

We also had an extensive exchange on arms control issues, START II ratification, theater missile defenses, the Non-Proliferation Treaty, chemical weapons, ensuring the transparency and the irreversibility of the process of reducing nuclear weapons.

Chechnya, of course, figured prominently in the talks. We reiterated our strong concern about the blood-letting, our support for the recommendations of the OSCE mission, and for a political settlement.

We had exchanges on peacekeeping and regional issues, such as Bosnia, Iran, Iraq, Libya, Tajikistan, and Haiti. Overall, it was a productive and wide-ranging visit.

Q Did you all get over the issue -- did Mamedov supply a list of weapons in the pipeline to Iran? And did Talbott convince Mamedov that Russia shouldn't help build nuclear reactors in Iran?

MS. SHELLY: Those issues were discussed, but I don't have further details to provide.

Q (Inaudible) the Russians to sign on to the military cooperation agreements -- to sign the military cooperation agreements that they refused to do in December?

MS. SHELLY: Other than the information that I have, I don't have anything beyond that. I'll check and see if, on that point, we have anything more we want to say.

Q Were there any tangible results that you can tell us about?

MS. SHELLY: Sid, we give readouts of these type of meetings. We usually talk about the subjects which were discussed. But we normally decline to provide a lot of detail on the specific results of those meetings. We keep those exchanges confidential.

Q Another subject?

MS. SHELLY: Sure.

Q Both Energy Secretary O'Leary and Deputy USTR Barshefsky are in Beijing but for different purposes. Secretary O'Leary has pocketed a large number of contracts, whereas Barshefsky is trying to avert a possible trade war between the two countries. Can you give us a status play of what we are doing in Beijing, or how they are doing?

MS. SHELLY: You know we are very circumspect at this podium from comparing one set of Cabinet activities with another. It's like a country comparison.

On both of those things -- and those are obviously issues we're following very closely. On Secretary O'Leary's trip, as you know, the Administration is committed to expanding opportunities for American businesses overseas. The U.S. has a $50 billion trading relationship with China and a very large trade deficit.

Secretary O'Leary's visit to China is aimed at expanding cooperation in the energy sector. Her visit is part of the Administration's policy of comprehensive engagement with China; and under that the Administration has sought to engage the Chinese at high levels to discuss areas of potential cooperation and to resolve problems and make progress in areas of concern, such as trade.

On the IPR talks, the talks are aimed at strengthened enforcement of intellectual property rights in China and are continuing in Beijing. The Deputy U.S. Trade Representative met with the Minister of Foreign Trade and Economic Cooperation, Wu Yi, and State Councilor Song Jian today. Discussions included areas such as market access, software protection, and data collection relating to enforcement efforts. Outstanding issues, as I'm sure you're aware, must be resolved before February 26.

We understand that discussions are scheduled to continue tomorrow, and perhaps you may be able to get some additional information from USTR on that.

Q Do you expect them to wrap it up tomorrow?

MS. SHELLY: I'm simply not in a position to make that kind of prediction at this point.

Q Does this send a conflicting message to the Chinese -- on the one hand, the O'Leary pockets of $4.6 billion; and, on the other hand, two days before possibly slapping sanctions on the Chinese?

MS. SHELLY: The timing may be read as odd by some, but nonetheless we cannot have every single other aspect of a relationship, one in which there is constructive and comprehensive engagement -- we cannot simply do every single thing that happens one thing at a time and put everything else on hold.

I think overall we have a constructive relationship. We have different interests there. Cooperating in the energy sector is certainly one, and that's very much in our interest. I believe that this trip was planned a long time ago, and prior to the evolution in the events related to the IPR.

So I think that our policy toward China and the degree of engagement is one in which you may well see -- not only now but in the future -- areas where cooperative activity is going forward. At the same time, when we have differences on issues and difficulties in other aspects of the trade relationship, those could be and are being in this case, thrashed out at exactly the same time.

We have common interests -- certainly also in the political arena, and safeguarding peace and stability in the Asia and Pacific region. We certainly intend to continue our high-level dialogue with China and we'll try to reduce the areas where we do have difficulties. We'll try to enhance those areas where we clearly are able to make progress.

Q Thank you.

(The briefing concluded at 2:O1 p.m.)

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