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MARCH 6, 1995

                      U.S. DEPARTMENT OF STATE
                        DAILY PRESS BRIEFING

                              I N D E X

                      Monday, March 6, 1995

                                       Briefer:  Strobe Talbott
                                                 David Rothkopf
                                                 Christine Shelly

Presidential Business Development Mission--March 7-8 .1
   Remarks by Deputy Secretary Strobe Talbott ........1-3
   --Overall Situation in Haiti ......................1
   --Transfer from MNF to UNMIH ......................2
   --Purpose of UNMIH ................................2,7
   --Status of Rebuilding of Economy .................2
   --International Aid & Technical Assistance ........2
   --Private Trade and Investment ....................2
   --Security for Business ...........................2,5-7
   --Regulatory/Customs Procedures ...................6
   --Corruption/Drug Transshipments ..................6
   Remarks by David Rothkopf, Under Secretary of
     Commerce for Internat'l. Trade Policy Develop
   --Focus on Sustainable Democracy ..................3-4,6
   --Sectors: Power/Telecommunications/Assembly,etc ..4
     Haiti Recovery Initiative .......................3-4
     --U.S. Dept. of Commerce Commercial Office ......3
     --Funding Approvals .............................3-4
     --U.S./Haitian Business Development Committee ...4
     --Business to Business Agreements ...............4
     --Signing Ceremony ..............................8

   Crime Problem .....................................9-11
   --U.S./NIS Anti-Crime Programs ....................10-11
   --Three-Pronged Approach ..........................10
   --Alleged Russian Government Links to Crime .......10-11
   --Alleged U.S. Links to Russian Mafia .............14
   Situation in Chechnya .............................11-13
   Reported EU Postponement of Trade Accord ..........11-13
   Russian Cooperation with OSCE .....................12
   Visit to Region by U.S. Embassy Personnel .........13

   Arrest of Cali Cartel Leader ......................13-14

   Reported Interest in Drug Summit ..................13

   Visit to U.S. by NATO Secretary General ...........14-16
   NATO/Russia Relationship ..........................15
   SecGen Claes Corruption Investigation .............15
   Withdrawal of UNPROFOR from Croatia/Possibility
      of Use of U.S. Troops ..........................16

   Holbroook to Croatia; Mtg with President Tudjman ..16-17

   U.S. Position on UN Sanctions, Humanitarian Sales .17-18
   Briefing by Ambassador Albright on Trip to ME .....18
   Report of Proposed Italian Diplomatic Presence ....18

   Assistant Secretary Lord's Trip to Region .........18
   Spratly Islands Dispute ...........................19


DPC #29

MONDAY, MARCH 6, 1995, 12:37 P.M.

MS. SHELLY: Good afternoon, everyone. I'm pleased to introduce guest speakers for today's briefing. They are Deputy Secretary of State Strobe Talbott and David Rothkopf, the Commerce Deputy Under Secretary for International Trade Policy Development.

As you may be aware, last week the White House announced that the Deputy Secretary of State would lead a Presidential Business Development to Haiti, March 7 and 8. Deputy Secretary of State Strobe Talbott will lead this mission with the International Trade Administration. Along with senior U.S. Government officials and members of Congress, Mission participants will include over 25 senior business executives.

The Mission caps U.S. efforts thus far to promote the recovery of the Haitian economy and provides a starting point for continuing progress in this area.

The Deputy Secretary will have an opening statement, and after that he and Under Secretary Rothkopf will be happy to take your questions.

Thank you very much.


Let me say just a few words about the overall situation in Haiti today, and then ask David Rothkopf of the Commerce Department to add a bit on the Business Development Mission itself.

As I think all of you know, the U.S. led U.N.-authorized 3l-nation mission to Haiti is preparing to pass the baton to a United Nations mission force under a United States commander. The U.S. is going from a maximum of about 2l,000 military personnel shortly after the intervention of last September l9, down to about 2,500 as the American portion of the U.N. force. The U.N. force will total 6,000, but a little less than half of that will be American military personnel.

The hand-off from the multinational force to the United Nations Mission in Haiti, or UNMIH, will take place at the end of this month. It's the judgment of: the commanders on the ground, of the Haitian Government, and of the United Nations Secretary General, that the situation in Haiti is now sufficiently safe and secure. This justifies the transfer from the MNF to the UNMIH.

The principal purpose of UNMIH -- the United Nations Mission in Haiti -- will be to maintain the safety and security of the environment for the next 11 months. This is so the people of Haiti can go about the business of electing a new parliament, local and municipal officials, and come December of this year a new president.

The UNMIH will also work with the Haitian authorities to complete the process of putting in place a new public security force to take the place of the FAD'H or the armed forces of Haiti.

The first class of a civilian Haitian police entered the new police academy in January of this year and will graduate in May. Another class will graduate each month thereafter, until Haiti has a new civilian apolitical police force.

Security is obviously key not only to the resumption of democracy in Haiti, but also to the rebuilding of the economy. There are already some encouraging signs. More than 35 manufacturing operations have restarted since the beginning of the year. The export of mangoes and papayas has resumed; the construction industry is on the rebound, and cruise ships are once again bringing tourists to Haiti.

To sustain the progress that has already been made and to ensure that it continues, the international community has committed itself to a massive program of aid and technical assistance to Haiti. International donors and lenders have already pledged $l.2 billion, and it's anticipated that $900 million of that total will be available over the next l2 to l5 months.

But a crucial part of the equation is private trade and investment, hence the mission that we're about to undertake. This will take representatives of 28 firms to Haiti for two days of intensive discussions with government, municipal, and private-sector leaders.

I would ask that you give a few minutes to David Rothkopf to describe the mission in a bit more detail. In addition to his job at the Commerce Department, he is also the head of our Interagency Task Force on the commercial and economic aspects of our policy towards Haiti.



We've been working on this mission for a couple of months, and it really signals the intensive start-up of our commercial and private- sector oriented efforts in Haiti. You might, in fact, consider this mission to begin a new phase of U.S. initiatives in Haiti, because what we do is go from focusing on the restoration of democracy and the restoration of a stable and secure environment to focusing on sustainable democracy. For a democracy to be truly sustainable: the people of Haiti have got to see hope; they have to see jobs being created; they have to see the new regime bringing to them some of the results that previous regimes have failed to offer them.

As a consequence, what we have tried to do is focus on a couple of key sectors, which will be most important to restoring the interest of the international business community. These, of course, augment the efforts of the aid community and the $l.2 billion that was committed by the donors in Paris at the end of January.

Sectors that we will focus on include: the power sector, telecommunications, the assembly sector, which consists primarily of the manufacture of apparel, but also some electronic products, agribusiness, and ultimately down the road perhaps tourism.

The mission represents a cross-section of these people. We had well in excess of a hundred companies express interest in going on this mission. This will be the first of a series of missions that will take place over the course of the next four or five months. It will be the largest, but all of those that will follow will focus on one of the key sectors that I've just indicated.

In addition to this series of missions, while we are in Haiti, we will be making a variety of announcements of specific aspects of the Haiti Recovery Initiative. These will include the formal opening of the United States Department of Commerce's Commercial Office in Haiti; the first time we've had a full-time Commercial Officer in Haiti.

It will include an announcement of some funding approvals that had been mentioned earlier but will make their way into the Haitian economy immediately after this mission. It will also include the first meeting of the U.S.-Haitian Business Development Committee. This Committee will bring together approximately 20 U.S. business leaders and approximately 20 Haitian business leaders, again from these key sectors, for a discussion on an ongoing basis. They will form working groups that will address the specific needs of their sectors. In each of their discussions, there will be representatives of the United States and the Haitian Governments. Our objective is to identify opportunities, and identify problems that need to be resolved. Also to have a forum where we can move towards resolving the problems and seizing the opportunities as quickly as possible.

We recognize that there is a window of opportunity for Haiti. The people do not have an indefinite amount of time. There are upcoming elections and results need to be achieved in the course of the next year.

But given the interest in this mission, given the reaction of the international donor community, we're extremely optimistic that those results will be achieved and this mission will mean to be the first sign of that process.

Thank you.


Q You mentioned funded approvals. Can you be a bit more specific as to what those include?

DEPUTY UNDER SECRETARY ROTHKOPF: Well, I'd like to leave something for the trip, but OPIC has promised $l00 million in funds to Haiti in the course of the next four years. We'll be making an announcement regarding the first set of those funds coming in. There will be a couple of other things, but that will be the largest of them.

Q Mr. Rothkopf, usually when senior Government officials take U.S. executives overseas on missions, there are usually some deals cooked in advanced that are announced in private commercial deals. Is that the case this time? Will there be some actual business- to-business deals being done?

DEPUTY UNDER SECRETARY ROTHKOPF: There will be a couple of specific business deals that will be announced on this trip. The results of some things that have happened in the past. There are also likely to be a couple of announcements of things that are going to happen in the future, but this will be consistent with past trips.

Q Is this mission intended in a way to reassure investors, who either left Haiti because of the embargo or they have moved their production elsewhere, that this is the time and the place to come back?

DEPUTY SECRETARY TALBOTT: Yes, among other things. Obviously, as I mentioned in my opening remarks, security continues to be a concern. Although very significant and promising progress has been made in that regard, security is a concern for those who are doing business in Haiti now. It's a concern for the Haitian private sector.

David and I and others have made a point in meeting with representatives of the Haitian private sector. When they've been coming up here, we've been explaining our strategy with regard to the interim public security force. But this is also a situation that the American business community needs to acquaint itself with. This is, by far, the best way to do it; to take them down there and let them see for themselves, and hear from both Haitians and from Americans and international workers who are down there.

Yes, George.

Q The assembly plant operations were pretty active in Haiti, employed a lot of people about ten years ago. Do you know... do either of you know how many Haitians were employed in these assembly-type operations at its peak, roughly? And has there been a rebound since October?

DEPUTY UNDER SECRETARY ROTHKOPF: Yes, there were approximately, according to the estimates that we have, perhaps as many as 50,000 employed in the assembly sector. We have seen estimates that in the course of the past several months, 35 firms or more have gone back. The estimate in terms of new jobs created has been in the neighborhood of about 5,000. It's a process that is ongoing. Several members of that community will be on this trip, and we have been working closely with members of that community, because we see it as one of the key areas for immediate job creation.

Q Minimum wage levels have been an issue for some time. Do you know what they are now?

DEPUTY UNDER SECRETARY ROTHKOPF: I don't know what the minimum wage is now. We are aware that they've been an issue, and we are working to ensure that the jobs that are created are jobs that genuinely do create hope, and don't continue a pattern of subsistence living.

DEPUTY SECRETARY TALBOTT: Could I just add one other point to your question. In addition to the security situation, there are also practices, and in some cases absence of practices, in place in Haiti that have made it an uninviting environment for Americans and others to do business. This has to do with regulatory procedures, customs procedures, that kind of thing. We've been working very closely with the Haitian Government to see if there aren't some improvements that could be made along those lines, and we're hopeful that there might be an announcement or two during the course of the mission on those kinds of things.

Q While we're also on that, what about past problems with corruption in Haiti and American business being willing to go in with that problem in mind?

DEPUTY SECRETARY TALBOTT: Corruption, of course, has been an issue. It's been an issue particularly with regard to the very large parastatal organizations. Corruption and inefficiency are the two endemic problems there. We and the Haitian Government, and the international community have been moving in the last week or so to make substantial progress toward the privatization of the very large parastatals, which we hope over time will be part of the larger process of democratization there. And our feeling is that in Haiti and everywhere else, democracy and transparency are the best antidote to corruption.

Q And to follow further with regard to corruption, Strobe, several weeks ago there were reports that the bay, the port of Port-au- Prince, was being used as a transshipment point for goods coming to this country. Has this issue ... we didn't get into this with Mr. Gelbard the other day. Has this issue been addressed? Has it been verified? It was said that American officials could not take or would not take any action. Can you tell me, is this true that these drugs are being transshipped out of Haiti?

DEPUTY SECRETARY TALBOTT: There's been a problem in Haiti, as it's been a problem elsewhere in that region. I might add, very much a problem during the reign of terror of the previous regime. I can assure that counter-narcotics is very much on our agenda with the Haitian Government. It comes up on a regular basis and notably including when Bob Gelbard goes down there.

Q You said that you were concerned about the security situation. There was a story, I believe, on Friday where a member of the parliament was found dead outside of I believe the police training barracks.

What is being done in this time of transition between Mr. Kelly being head of sort of the security and the U.N. that's supposed to come in and take over this job? What are we doing to try and aid in this situation?

DEPUTY SECRETARY TALBOTT: First of all, of course, we are aware of the murder of the parliamentarian. It's disturbing, and it's under investigation as well it should be. More generally, the important part of the role of the new force, the UNMIH that is coming in, is going to be to over the next 11 months assure not only a continuation of the safe and secure environment that has developed in recent months but an improvement in that area.

In addition to that, the police academy, as I indicated, is continuing to produce first-class police officers, who I think meet the criteria of what a police should be in a democratic society. But this is like virtually everything that we're talking about here in Haiti; the development of democratic political institutions; the development of the infrastructure, and a climate that will be conducive to trade investment. This is going to take a long time.

One of the most important points, I think, about this mission is that while the other two missions we're talking about, the multinational force and the UNMIH, are temporary visitors to Haiti. We hope that representatives of some of the companies that we will be taking down there will be permanent visitors to Haiti.

In other words, we hope that trade and investment will be a permanent fixture and a growing fixture in Haiti, and we see this as a big step in that direction.


Q Apart from limiting the parastatals, what mechanism do you have for seeing that the families who have been ruling Haiti for the last 50 years don't simply take over this new system and start the whole system of corruption all over again?

DEPUTY SECRETARY TALBOTT: This is an honest answer. I don't mean it to sound in any way glib, Jim, but it really goes to the core of an important aspect of our policy. That's up for he Haitians to work out. That's a matter for Haitian law which, of course, means it will be very much on the agenda of the new parliament, which will be elected in June. They need to work that out, and they need to do it in a way that balances reconciliation, which has been a principal theme of President Aristide. Also equity and the need for a functioning democracy in which the greatest number of Haitian people feel that they have a stake.

Q Would American law, which prohibits the paying of bribes to foreign corporations, could it be brought into play to make sure that...

DEPUTY SECRETARY TALBOTT: I assure you, American law, including in that respect, will be brought into play in every respect. In addition to have an obligation to follow American law, if we can use American law in a way that will be conducive to what I think most Haitians want to see, of course, we'll do that.

Q On the agenda there's a reference to a signing ceremony at 1:30 on Wednesday. What will be signed?

DEPUTY UNDER SECRETARY ROTHKOPF: There will be a variety of things that will be signed at that ceremony. There will be some of the announcements of some of these business deals that have taken place. There will be also the OPIC signing that I had talked about. There will be an agreement between USAID and the Haitians providing some funding for their mixed commission and other aids to the government's private sector communications efforts and perhaps there will be one or two other things then.

But we'll also at that time announce the results of the BDC meeting, which will have taken place over the preceding 24 hours and will, I believe, have a fairly rich agenda for the year ahead, which will be outlined at that time.

Q What steps has the Haitian Government taken to demonstrate that it is open for business, that it welcomes business, that it is not going to be an impediment to business?

DEPUTY SECRETARY TALBOTT: The Aristide Government has committed itself to a range of essentially free-market economic reform. I believe that these were first announced at the time of the Paris donors conference, but certainly a number of steps have been taken since then. I mentioned an answer, a belated answer to Karen's question, that there will be a couple more steps taken while we are down there.

But perhaps the most important overall factor is, of course, an appreciation on the part of those representatives of American business, who are contemplating doing business down there, and that stability and openness have indeed returned to that country and society. And that's why we feel that it's very appropriate to take these representatives down there to let them see and hear for themselves.

Q On Mr. Rothkopf's ... just a technical question. You say OPIC has agreed to provide $100 million over the next four years. Do you mean $100 million in loan guarantees?

DEPUTY UNDER SECRETARY ROTHKOPF: Yes, there is an on- lending program part of that. OPIC can give you specific details, but it's primarily loan guarantees.

Q Strobe, would you take a question on Russia?

DEPUTY SECRETARY TALBOTT: I would love to, but I'm not. (laughter) There's no subject I care more passionately about, but it's really a slippery slope problem. Unless my answer were totally comprehensive and totally persuasive, there might even be a follow-up question, and that would deprive Christine of a chance to get into the discussion that she's obviously now ready to have. So some other time.

Q Is Moscow Dodge City? That would be my question.

DEPUTY SECRETARY TALBOTT: Moscow is Moscow, and you can quote me.

Q Thank you.

MS. SHELLY: Thank you very much.

(Deputy Secretary Talbott and Deputy Under Secretary Rothkopf concluded their briefing at 12:57 p.m., after which Mr. Shelly immediately began her briefing.)

MS. SHELLY: Questions on other subjects.

Q (Inaudible)

MS. SHELLY: I hope this is a new one. He just answered that one.

Q Oh, no, no, not at all. I just scratched the surface. An article in The Washington Times today, Christine, by our colleague, Mr. Gertz, quotes some very disturbing reports, I believe, alluding to the Central Intelligence Agency regarding Moscow as being kind of wide open like a Dodge City.

The assassination of the journalist, television executive, being attributable, according to some sources, to Mafia-mob type activity and possibly having a government connection. Have you any comments on that article?

MS. SHELLY: We've certainly seen the article and have read it with great interest. The parts of it that get into purported links between - - also citing a CIA report, obviously I can't get into any detail regarding what might come from intelligence reports.

I would like to use the occasion, however, to talk a little bit about the crime problem in Russia. It's obviously a very serious problem, and it poses a threat which goes well beyond Russia's borders. President Yeltsin has acknowledged that's probably the number one problem which is facing Russia today. We're certainly very mindful of the problem.

The rise in organized crime, financial crime, nuclear material smuggling and drug trafficking are all aspects of that problem which give us great concern. The negative effect crime can have on democratic and economic reform movements -- not only in Russia, but also in the New Independent States of the former Soviet Union -- and the potential that has for the average citizen to equate crime with a kind of market economy, are serious implications of the growing crime problem.

The United States for its part works diligently with Russia and with some of the other NIS countries on a series of anti- crime cooperative programs. We recognize that only through a partnership with the NIS we can hope to address these kinds of troubling developments.

During their summit meeting, as I think you're aware, in Washington last September, Presidents Yeltsin and Clinton issued a joint statement on cooperation in promoting the rule of law and in combatting crime. Our approach to the anti- crime efforts is therefore three- pronged.

We have expanded our rule of law programs and have placed a new emphasis on assisting Russia and the other NIS countries with criminal justice reform.

We have begun a major program of law enforcement training in Russia and the other NIS countries to counter the threats posed by crime. These training programs are being implemented by various U.S. law enforcement agencies.

We're also working to institutionalize our partnership with Russia and the other NIS countries through the negotiation of law enforcement agreements, which would then allow us to share information and to cooperate in investigations, prosecutions and in the prevention of crime. We are now in the final stages of negotiating such a law enforcement agreement with Russia.

While U.S. assistance has a valuable role to play, ultimate success in the battle against crime, of course, rests with Russia and the other NIS countries themselves.

Q Have you said in this discourse whether there is -- the U.S. detects any government links to the crime wave in Russia, which seems to be the gist of the Washington Times' report on the CIA report?

MS. SHELLY: Yes, but the problem on that is that it then gets into the sources of that. We've seen the article, and we note that it has the allegations of those connections in it. I'm afraid it's very difficult for me comment on that specific thing without then getting into what we might know or do know from intelligence sources.

Q Christine, when you talk about the threat of criminal climates on democracy, can you sort of discuss that a little bit more in terms of Russia? Are you worried that this crime wave is going to provide an excuse or a provocation for Yeltsin and his supporters to crack down on people in general?

MS. SHELLY: I think that's probably taking it farther than I would be prepared to go today. The issues in Russia and the impact that it has on Russian society overall are of sufficient importance to us that we have initiated these programs. Certainly I think the recent statements by President Yeltsin, and certainly the very strong domestic focus of his recent speech to the Duma, also suggested where this falls in the importance for the Russian leadership itself.

I think that the actions that they ultimately do take will certainly reflect their concerns and obviously the information that they have on exactly what is going on. But beyond noting in particular what it is that we are trying to do to be able to help Russia with these problems, I really wouldn't want to take it much further than that.

Q This is another Russian-related question. The EU today apparently postponed indefinitely a trade accord with Russia because of Russian action in Chechnya. The United States' position on Russia vis- a-vis Chechnya has been much less aggressive than the EU, and I'm interested in what your reaction is to that.

MS. SHELLY: I'd have to check and see specifically what the action is. I don't have anything on that with me. I think that it doesn't come as a surprise to us, though, because of certain information that we also had that the situation in Chechnya was likely to affect that type of decision by the European Union.

The situation in Chechnya remains worrisome. The picture there is certainly very mixed. We would like Russia to move on with the cooperation with the OSCE, which has not been able to perform all of the functions that it would like. We certainly want it to be able to be in Chechnya and to be able to have full access to all of the locations and people that they feel that they need to in order to perform their mission.

So we have not seen the kind of results yet on Chechnya that we would like to have seen at this point, but it's obviously up to the EU to decide how much that situation affects or doesn't affect other activities they have in progress.

Q Are the Russians keeping them out, or is it the war situation? Is there an analysis there? The access problem, because most of those people are elderly Russians, ethnic Russians, are under fire and they can't get out.

MS. SHELLY: Barry, I'm honestly not in a position to answer your question.

Q I wouldn't (inaudible) or overt, you know --

MS. SHELLY: It may also be a mixture of various factors. I mean, there is fighting which continues in some areas. There is some shelling which continues. We know that access has been a problem. But I think without actually being on the ground ourselves, it would be very difficult to give a definitive explanation for the continued difficulties the mission is obviously having.

Q Could I go back --

Q Did you say that you were going to try to get a response, though, as to whether or not the United States feels that the EU action is appropriate?

MS. SHELLY: As to the appropriateness of the EU action, that's a question really for the EU. All I acknowledged was that we are aware of the fact that from conversations we've had with the EU, their perception of the situation in Chechnya certainly could impact -- and obviously in this case I don't have any basis to question what you said at the beginning about their decision, but it certainly doesn't come as a surprise to us that it has affected their action on other tracks.

Q But you don't endorse it.

MS. SHELLY: I think that it's just not something that we feel compelled to make a public comment on.

Q Christine, to follow further on your answer to Barry just to clarify. I take it from the answer that no U.S. Embassy personnel from Moscow have been down to the area to look for themselves firsthand. I know they hadn't recently, and I don't know about the last week or so.

MS. SHELLY: Not specifically that I'm aware of. I'll be happy to check on that point and see if there's anything at odds with what I've said. But I think that the Embassy personnel have been fairly constrained in terms of their activities down there in the recent time frame. But, as I said, I'll be happy to check and see if there's anything new.

Q Another subject. Any reaction on the capture -- surprising capture of this Colombian drug kingpin?

MS. SHELLY: Are you talking about the Colombian?

Q Yes.

MS. SHELLY: I just have a little bit of information on that. We applaud the efforts of the law enforcement authorities who arrested Jorge Rodriguez-Orejuela, the brother of Cali Mafia leaders Miguel and Gilberto. We have consistently supported an arrest policy, which is preferable to allowing criminals to turn themselves in under current laws which then give an automatic one-third sentence reduction to those who surrender.

The individual in question, however, is not considered by Colombian or by U.S. authorities to be the mastermind behind the tons of cocaine and ever-increasing amounts of heroin which are entering the United States from Colombia.

We hope, however, that the arrest may provide information which would lead to the capture of those who are responsible. We believe that these criminals must incur the maximum penalties for their crimes permitted under Colombia law. To do otherwise makes a mockery of the judicial system and is an insult to the hundreds of Colombians who risked their lives to bring these individuals to justice.

Q Do you think it's too much of a coincidence that they happened to almost run into this guy one day after the certification (inaudible) was given by President Clinton?

MS. SHELLY: I don't have any particular comment on the timing.

Q Christine, Colombia and other countries apparently have restated their interest in having another drug summit. How does the U.S. feel about that?

MS. SHELLY: Let me check. I haven't seen that particular proposal, but let me check and see.

Q Christine, speaking of crime, can I get back to Russian crime for a moment? According to other reports, the Russian Mafia has links and sometimes even leadership based in the United States, particularly the Brighton Beach section of New York.

Is the United States cooperating with the Russian law enforcement people on this international link?

MS. SHELLY: As to the information that we would have about their activities here, that would not be a State Department issue; that would be a Department of Justice issue. Other than being able to comment generally on the cooperative programs that we have going with Russia and to be able to cover what I just covered a little bit earlier, I can't get into the specifics. It's a jurisdictional question.

Q Christine, do you by any chance have anything on Mr. Claes' visit? The weather is as bad as it is in Brussels. He must have another reason for coming here. (Laughter)

MS. SHELLY: Is it as bad as Brussels?

Q It's always bad in Brussels.

MS. SHELLY: Basically, he's here for a set of meetings with Secretary Christopher and Secretary of Defense Perry. He's also meeting the President tomorrow. He will be spending, I'm told, the rest of his time in appointments with various congressional leaders.

Here, with the Secretary, they will be discussing the full range of NATO issues, including the NATO expansion issue. They'll also be discussing the development of NATO's relations with Russia, the Partnership for Peace, the former Yugoslavia and a variety of other topics that we're working on together.

This is part of the regular dialogue that we maintain with him, and, as is our usual practice, we will endeavor to get a fuller readout on his meetings here once they are concluded.

Q Could you -- do you have something on the status of the instruments -- if that's the right word -- for Russia's affiliation with NATO? You know, we haven't touched on that subject in a week, or two maybe. Are they ready to come aboard? Is the President ready to release his letter? Do you have the mechanism for the special relationship? Where does that stand now? Are the Russians any closer to obliging the U.S.?

MS. SHELLY: On the points that you've mentioned, as you know, they got a full vetting when Mamedov was here and having his full range of security discussions.

Q Exactly.

MS. SHELLY: Anyway, I don't have anything new to announce on that score, so I think that the status is still the same as it was at the end of that visit.

Q Christine, to go back to the NATO Secretary General, why does the United States not believe that he should step aside while this corruption scandal is investigated and resolved?

MS. SHELLY: Carol, I would refer you specifically to what the Vice President said when he was in Brussels, which is that we have full confidence in him as Secretary General. The other issue that you've raised is something that is being pursued in the Belgian context, and we feel it would be inappropriate for us to comment on that.

Q But don't you think that that -- I mean, it's pretty intense. Doesn't that take him or take his attention away from the NATO issues, and shouldn't that have somebody's full attention?

MS. SHELLY: I think the degree to which it does or it doesn't, that's probably a question better directed to his spokesman rather than to us specifically.

Q And just to follow that and Barry's question, will there be an opportunity here or any of the other agencies for press to speak with Mr. Claes?

MS. SHELLY: There may be. He's going to be over at the Pentagon, as I mentioned, and he'll also be at the White House. I don't know what the press arrangements are over there. It may be that in one or both of those locations he may be taking some questions.

Q Have there been any developments with regard to the withdrawal of UNPROFOR from Croatia, or has he said anything about that, or will he be discussing that to your knowledge?

MS. SHELLY: I would guess that would be a subject that would come up. NATO, as you know, is engaged in the necessary contingency planning should that event actually take place. As I think you also know, Assistant Secretary Holbrooke is out in the region today specifically having meetings with the Croatian Government, with President Tudjman. We may have more to say on that a little bit later.

But, as you know, it certainly still is our very strong hope and view that UNPROFOR will remain in Croatia and not be withdrawn. But certainly it's only prudent that the necessary contingency planning be done.

Q Christine, U.N. sanctions on Iraq.

MS. SHELLY: Sorry. Was it the same topic? Can we come back?

Q Would the contingency planning ongoing now include possible U.S. troops?

MS. SHELLY: As you know, a decision on that has not yet been made; but that certainly has not been ruled out as a possibility.

Q And the Holbrooke updating, would that be on camera or on a piece of paper?

MS. SHELLY: Well, that's an interesting question. I don't really have an answer to that one yet. Let's see if I have anything else on his visit.

My understanding is he's just going out there and then I think he's coming back tonight, so he'll be back tomorrow. He arrived in Zagreb this morning for meetings with Croatian Government and UNPROFOR officials, and he's been exchanging views generally with his interlocutors on improving the chances for avoiding war and trying to promote a settlement in Croatia.

That's all, except for reiterating what I said before about remaining very concerned about Zagreb's decision not to allow UNPROFOR to continue its operations, and we believe that undermines the prospects for peace stability in the Balkans.

I will see if it's possible to get him down here later in the week, and, if not, I assume we'll provide a readout in the written form rather than having him be here personally.

Q On the Middle East, Christine. The Syrians --

MS. SHELLY: Actually, if we're going to switch, I owe him first, and then can I come back to you?

Q Has there been a softening up of U.S. conditions for lifting the sanctions on Iraq?


Q Compared to before?

MS. SHELLY: No. There has not been any easing on that at all.

Q Could it be that we're getting into it even subtly, so far as the humanitarian exception? There have been reports that you're willing to ease that a little bit.

MS. SHELLY: Okay. Let me just also note today that I think you all are aware that Ambassador Albright is actually going to meet with the press up in New York on her trip at 3:30 today, so I don't want to get too heavily into the subject matter that she will be raising.

What I can say just on the humanitarian sales aspect is I think you know the mechanism exists for oil to be sold in a way which allowed for the purchase of foodstuffs, medicines, and other things. Saddam Husayn has rejected the premises in those resolutions, and at the same time has directed Iraqi resources toward other things, such as the palaces and mobilizing his military forces.

We have been very interested in trying to examine ways that we could achieve the goals of the Security Council resolutions in a manner which would alleviate the suffering of the Iraqi people, but this still has to be done within the framework of the sanctions regime.

Q What do you know about Italy opening, or planning to open, some sort of diplomatic presence in Iraq?

MS. SHELLY: I've seen one wire report on that, but I understand also that the Italian Government said that no decision had been taken.

Q Was that issue discussed between the Italian Foreign Minister and Secretary Christopher last week?

MS. SHELLY: Not specifically that I'm aware, but I'll check and see if by any chance it did come up.

Sid -- I'm sorry.

Q Yes. Tishrine, the Syrian Government newspaper, had a story -- a "story," I guess you'd call it -- in the paper this morning that said they rejected the latest Israeli offer. I mean, leaving out the accuracy of the report itself, does the U.S. have an on-the- record response about that or about anything regarding the Secretary's trip?

I mean I know we're getting a BACKGROUNDER this afternoon, but do you have anything ON THE RECORD to say about it?

MS. SHELLY: Absolutely nothing. (Laughter)

Q Do you have a readout on Winston Lord's trip to Northeast Asia last week?

MS. SHELLY: Not yet. He's still out there. He's got, I think, one or two more stops. He's supposed to be coming back, I think, on Wednesday. I'll either see about the possibility of having him do a readout or else try to get as full a readout as possible when he comes back, but he's not back yet.

Q Thank you.

Q One more quickly. On the OpEd page in the Times this morning --

MS. SHELLY: Which Times?

Q The Times from Washington.

MS. SHELLY: Washington Times.

Q -- the subject was the Philippine Government and their military projections not being adequate to hang on to their Spratly claims and the possibility of the U.S. getting back into some kind of naval cooperation with the Philippines. Do you have any information on that?

MS. SHELLY: On the general subject, I don't have anything new on that. You've asked us a couple of times, I think, about the issue in general. But I think on this one I'll also stick to our fairly firm policy not to comment on pieces on the OpEd pages.

Q Now, wait a second. They are a defense treaty ally.

MS. SHELLY: Right.

Q Does that have any relevance to this dispute with the Chinese?

MS. SHELLY: All I was signaling was that I didn't have anything new to report. We had this come up a couple of times in the last probably two weeks or so, and I don't have anything new.

Q How about elections in Estonia?

MS. SHELLY: Don't have anything on that either.

Q Christine, last week -- last Friday, some of the U.S. and NATO allies decided to ban the PKK side organization -- for example, the Kurdish Information (inaudible) -- they banned their soil. I believe that one or two of them is active in U.S. soil -- one is in New York, and one is in Washington, D.C. In the past you advised your allies against this kind of action; and what are you planning to do in your soil in this kind of organization?

MS. SHELLY: I don't have anything specific to announce on this; but I'm told that any activities by the information offices in question that would contradict U.S. law would then turn the issue into a domestic law enforcement issue, which then would fall under the purview of the Department of Justice. But I don't have anything beyond that to report for you at the moment.

Q Thank you.

MS. SHELLY: Thanks.

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


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