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U.S. Department of State
96/08/08 Daily Press Briefing
Office of the Spokesman




                     U.S. DEPARTMENT OF STATE
                       DAILY PRESS BRIEFING
                            I N D E X 
                     Thursday, August 8, 1996

                                          Briefer:  Nicholas Burns

ANNOUNCEMENTS
  Welcome to Journalists from Korea, So Africa & Moldova........  1
  US Rep David Greenlee's Stmt on Monitoring Group Mtg, Lebanon.  1

MIDDLE EAST PEACE PROCESS
  Fighting Between Hizbollah, the SLA & the IDF/Roll of
    Cease-Fire Agreement/Ongoing Monitoring Group Mtgs..........  2-6
  Alleged Rpts:  Air Raid in So Lebanon/Syrian Aircraft Used
    Against Israelis............................................  1-2,4
  Alleged Iranian Accusation of Airspace Violation..............  7

RUSSIA
  Chechen Rebel Offensive in Grozny/Role of the OSCE............  7-8
  Vice Pres Gore's Msg to Pres Yeltsin & PM Chernomyrdin/
    Secretary Christopher's Msg to ForMin Primakov..............  9-10
  German ForMin Klaus Kinkel's Mtg w/ForMin Primakov on Autonomy  9
  Pres Yeltsin's Inauguration/Health............................  9-12
  --Appointment of PM Chernomyrdin, COS Chubais, & Gen Lebed....  11
  Russian Economy/Postponement of Payment to IMF................  10-12

IRAN/LIBYA
  Sanctions Bill:
  --European Countries' Reaction/EC Kept Apprised of Status of
    Formation/Object of the Bill/Possibility of Formal Demarche.  13-18
  --Importance of Deterring Terrorism...........................  13-14,
                                                                  16,18
  --Constructive Engagement/"Critical Dialogue".................  18-19
  US Concern Re Possibility of Libyan Chemical Weapons Facility.  17

ARMS CONTROL
  Secretary Christopher's Mtg w/Amb Chandra re Status of CTBT/
    Five Nuclear Powers Accepts Compromise with China...........  19-21

VENEZUELA
  Discussions re Civil Aviation.................................  21-23

IRAQ
  Status of UNSC Resolution 986.................................  24

TURKEY/GREECE
  Dispute of Greek Islets in the Aegean.........................  24

U.S. DEPARTMENT OF STATE DAILY PRESS BRIEFING

DPB #129

THURSDAY, AUGUST 8, 1996, 1:09 P.M. (ON THE RECORD UNLESS OTHERWISE NOTED)

MR. BURNS: Good afternoon. Welcome to the State Department briefing. Glad to have you all with us.

I want to welcome today -- we have journalists from the Korea Press Center, sponsored by the Institute of International Education.

We also have Mr. Marlin Padayachee, the political reporter for the Post newspaper from Durbin, South Africa.

And we have three Moldovan journalists, sponsored by the Meridian Center.

So welcome to all of you.

After the briefing, I'm going to be putting out a statement. It's not a statement by me, but it's a statement by David Greenlee, who is the Chair of the Monitoring Group.

The Monitoring Group met this morning at Naqoura in Lebanon. All five partners of the Monitoring Group met. And this is a very short statement that basically says that they met, that they reviewed the procedures that the Monitoring Group will deal with. It's a short statement saying that they hope that their work will be successful, to contribute to a defusing of tensions in southern Lebanon and in northern Israel.

Barry?

Q My question on that: Are they taking up today's air raid on southern Lebanon?

MR. BURNS: I don't believe they were asked to do that. As you know, the agreement that was put into effect that was negotiated by Secretary Christopher in late April concerns attacks on civilians, and these are civilians either in northern Israel or in Lebanon. I don't believe -- I could be mistaken -- I don't believe that there has been arequest to have the Monitoring Group look at the recent exchange of fire between Hizbollah, the SLA, and the IDF.

Q The Israelis bombed outside the zone at noon today, Nick.

MR. BURNS: I'd have to refer you to the Israelis and, of course, to the Lebanese to ascertain where the bombs hit. As you know, over the last couple of days there have been a substantial number of attacks on the Israel Defense Forces in southern Lebanon, inside a security zone. Israel responded with air attacks.

Israel, of course, said that it was attacking Hizbollah targets. Obviously, if one side or another wishes to bring a complaint, there is now a mechanism to do that. It's the Monitoring Group.

I'm just not aware that any side in this conflict has brought a complaint to the Monitoring Group.

Q Do you think its a surge in bucking the fighting too? Anything in particular?

MR. BURNS: It's very hard to know, Sid. We certainly have seen it. We certainly hope that this fighting will diminish. We don't wish to see this fighting continue at all. It's not in our interests. It's not in the interests of any of the countries involved.

Q Do you have any other member --

Q I'm sorry -- just to follow up. It doesn't fit into past patterns where President Assad is upset with the state of negotiations, so it tweaks the guys in south Lebanon a little bit?

MR. BURNS: It's difficult for us from this great distance to ascertain what's in the minds and what the strategy and tactics of Hizbollah are, but certainly we're very much opposed to Hizbollah and to the tactics they've employed in the past, and we would like to see this fighting stop.

Q Are you acting on that hope? Do you tell that to Damascus?

MR. BURNS: Normally, when we see rounds of fighting like this, we do talk to the various parties involved; and I know that we're doing that today.

Q Who are the Syrians on this?

MR. BURNS: Your normal parties -- yes.

Q Nick, is it your job to respond to the -- I'm sorry.

MR. BURNS: Syria is a normal party. I can't catalog for you all the diplomatic contacts that we've had today, but rest assured there we are talking to the right people who have influence on this matter.

Q I think we have another round on this.

Q Thank you. On the same subject anyway --

MR. BURNS: Excuse me. I want to make sure I said what I said.

Q I just don't know who you mean by the "right people."

MR. BURNS: Yes. Since I can't catalog for you all the diplomatic contacts that we have had, then I'm just going to have to say that we are active diplomatically, as we normally are in this situation, but I can't give you a complete list of everyone with whom we've spoken.

Q The people you spoke to, but who are the normal people in this? Whom do you consider the normal people?

MR. BURNS: The usual suspects.

Q Recent events have clouded it up a little bit. Who do you consider now the "usual suspects"?

MR. BURNS: Sid, when there's fighting in southern Lebanon, it's not hard to know who the parties are and who you have to talk to try to see if the fighting can end.

Q Does the cease-fire agreement in any way increase any responsibility for any of the usual suspects to exert themselves a little more to try to maintain order in the area? I know specifically that it is designed to protect civilians; but having constructed this through some arduous diplomacy has the U.S. imposed, or does it think the parties have undertaken, new responsibilities or additional responsibilities -- or are things as they were, except when civilians are concerned?

MR. BURNS: The advantage of the agreement negotiated by Secretary Christopher is that there are now very clear rules of the road to protect civilians -- Arab civilians and Israeli civilians -- and there is now a Monitoring Group that can in effect adjudicate some of the problems that one side or the other, or many of the sides, bring to this.

That is a great step forward, beyond the agreement that was put in place in the summer of l993 which clearly had broken down by the spring of this year, which led to the horrific fighting which was responsible for the deaths of many people and the wounding of others.

Q I guess what I'm asking is whether the agreement has a spirit there, because usually there's a legalistic agreement and then the parties that are involved in framing an agreement and are aware of the general contours of the objectives here and in the spirit of the agreement sometimes are asked if they wouldn't "Please," -- et cetera, et cetera, et cetera.

In the course of these negotiations, was any effort made to ask the parties to be a little bit more restrained all around, let alone in the matter of bopping civilians?

MR. BURNS: Certainly, we'd like to see an end to all fighting in southern Lebanon, but that is not a realistic proposition. Even the week after this agreement was negotiated, there was fighting in the security zone between Hizbollah and the IDF.

It's something that's not going to disappear quickly until the larger reasons for the fighting are taken care of, but what we were able to accomplish is a mechanism to protect civilians. That was a great step forward, and that has worked since April 26 and 27 of this year.

The fact that the Monitoring Group now had its first meeting today under the U.S. Chairmanship is another step in the right direction.

Q Nick, do you have any comment on the reports that the Syrians used Iran's aircraft batteries facing the Israelis? Do you consider this a kind of escalation from their side?

MR. BURNS: I haven't seen those reports. I'm not aware of them. Therefore, I can't confirm them.

Q Can you take the question?

MR. BURNS: I'll be glad to look into it, yes, but I have not seen those reports.

Q What would make this cease-fire, the partial cease-fire -- this arrangement that was made with both the Monitoring Group? They thought a cease-fire, which would eliminate any raids or any attacks by Israel and any attacks by Hizbollah and any attacks in that treaty to bring a complete calm, quiet border between Israel and Lebanon?

MR. BURNS: That is the overall strategic objective that certainly the United States has for southern Lebanon and northern Israel: to cease all fighting.

This agreement protects civilians. It does not speak to the question of the fighting that does take place inside, and sometimes outside, the security zone between the IDF and Hizbollah. And, obviously, we would like to continue the Middle East peace discussions so that when the politicians resolve their differences this other kind of fighting between the armies and in the guerrilla groups might stop altogether.

But I do want to point out again the narrow drawing of the cease- fire agreement around civilians, because that was the immediate problem that Secretary Christopher had to deal with in April when he went out to the Middle East: the fact that so many hundreds of thousands of Arab civilians had to flee southern Lebanon for Beirut and the Beirut suburbs, and the fact that tens of thousands of Israeli civilians had to flee northern Israel.

We've essentially taken care of that, but the larger question that you ask is much more challenging and longer term.

Q So you feel that you're dealing with them essentially by working toward and trying to push the parties toward negotiations to deal with the overall situation.

MR. BURNS: That has been our strategy. It was, certainly, in the spring, and it remains our strategy. That's why the United States believes it's important for Israel and Syria to resume their discussions as well as Israel and Lebanon --

Q Well, do you think --

MR. BURNS: - and we are working towards that.

Q I understand. I wonder if you can see that the inference here -- I don't know how we can keep this up -- but the inference here is that the U.S. Government considers the current state of affairs as only natural in the absence of an overall agreement -- that there's a limited agreement, which took a lot of work and it's in place, but until there's an overall agreement this is what goes on. And neither of the parties are doing it. They're using the absence of an agreement -- MR. BURNS: I did not use the word "natural."

Q I know you didn't use the "natural."

MR. BURNS: And, certainly, I do not mean to infer that. The fact is that the reality is in southern Lebanon for many, many years there has been fighting.

It's an unfortunate reality, because many people have lost their lives and civilians have been affected by that.

The agreement put in place by the United States is an effective agreement -- has now been since late April. It's an important agreement.

It's also important to deal with the larger reasons for the fighting; but it has not stopped, and we believe will not stop until there can be political progress made in the negotiations. That's why we've put so much of an effort into those political discussions.

Q Right, but what I find missing here is the U.S. saying, "And in the meantime, we are trying to do 'X', and in the meantime 'Y' and 'Z' would be good if 'Y' and 'Z' stopped doing 'A' and 'B.'"

You're not doing that. You're talking -- or, at least, you're not saying you're doing that. You're talking about the agreement you got, and you're talking about the need for an overall agreement. Meanwhile there is fighting going on, and the question is: what is the U.S. doing -- or is the U.S. doing anything to try -- to end that fighting, absent an overall agreement? That's what I don't hear.

MR. BURNS: Barry, I think we've done this. I this I've already answered the question you just posed. We are working --

Q Usually what you do, but what are you doing in this instance?

MR. BURNS: We are working to try to convince these countries to resume their political discussion so that there can be peace. Until that happens -- and that is a longer term objective -- we have taken action to protect civilians, and we certainly wish that all types of fighting might stop -- inside the security zone, outside the security zone. The United States does not control that region. There are independent actors that are engaged in this fighting, and we do bring our opinions to bear in this situation, but we don't control it, and that's reality.

Q Is it your duty to respond to the Iranian accusation, or is that being done at the Pentagon? There hasn't been any -- the airspace violation accusation. Or does the U.S. Mission handle that --

MR. BURNS: I think that that has been handled adequately and responded to adequately by our military in the Gulf on the scene. There was an exercise, a military training exercise that took place, and there was no violation of Iranian airspace. It's a fabrication on the part of Iran.

Q Nick, can we talk about the fighting in Chechnya, reports about Chechen rebels have seized part of the Moscow headquarters in Grozny. The Red Cross workers are caught in the cross-fire, and how can you directly address the situation?

MR. BURNS: The United States is watching with great concern and great disappointment the fighting this week in Chechnya, this time clearly caused by the Chechen rebel offensive. What the Chechen rebels have succeeded in doing by their offensive, of course, is endangering the lives of the thousands -- the tens of thousands of civilians who still live in Grozny and around Grozny and the suburbs of Grozny, and those poor people have nowhere to go. They've already been subjected to 20 months of war, and 35,000 civilians have been killed in the war.

We frankly believe that the Chechen rebels and the Russian Government need to return to their June 10 understanding that did give some promise that after so much bloodshed, there was a way to resolve these differences at the negotiating table. That's what they committed themselves to do.

The Chechen rebels now have taken up the gun again and have gone after the Russians but not just after the Russian military; they have put Chechen civilians and Russian civilians and others in the area into extreme danger. The fighting has been horrific. You've seen the television footage from Chechnya.

There's only one way out. There has been only one way out since December 11, 1994, the day that this all started, and that is that there is no military solution to this ethnic and political conflict available to the Chechens or to the Russian Government.

It appeared to us in June, during the Russian presidential campaign, that both sides had finally concluded that it was time for negotiations to resolve these differences. They committed themselves to that. There was a high-level meeting between President Yeltsin and the Chechen rebel leadership in the Kremlin. But all that progress seems to have evaporated, and now it's back to war. We're profoundly disappointed to see this, and we certainly would advise the Russian Government and the Chechen rebels to return to the negotiating table. Nothing good will come of this fighting.

Q But in light of your disappointment, do you think it's now time for the international community to become more involved in --

MR. BURNS: We have to be very clear about what this is. Chechnya is part of Russia. It remains so. It is recognized by every state internationally, including the United States, to be part of Russia. This is a conflict internal to the Russians and the Chechens.

We have offered the role of the Organization of Security and Cooperation in Europe. They have an office there. They have been involved in trying to promote negotiations between the Russians and the Chechens in the past, but those efforts have not been supported effectively by either side.

That is the vehicle for the international community to become involved. But ultimately in a situation like this, it really is up to the two sides themselves to decide that they're going to stop endangering the lives of civilians.

Q Do you know if the OSCE is still in Grozny?

MR. BURNS: The OSCE is still in the area. I don't know where their representatives are today and yesterday. Hopefully, they're not in Grozny, which is a hell hole today.

Q Nick, did you mean to suggest that the rebels were unprovoked in their recent attack?

MR. BURNS: David, I think, as you know very well, what has characterized this fighting now for 20 months is the fact that there have been atrocities committed on both sides. There has been aggression at various points of the war by both sides. This latest round of fighting -- I'm sure that the Chechen rebels can give the international community many, many reasons why they felt they had to undertake this attack.

What we're saying is that kind of thinking will not get them what they want, and that kind of thinking on the Russian side will not achieve a resolution in Russian eyes either. There have been so many reprisals, so many atrocities, so much bloodshed, that, of course, either side can point to compelling reasons to undertake a mission.

The fact is, it's not going to solve anything. It's just going to kill more people, and we very seriously would like to promote the idea that negotiations are the only way out. There's no military solution available to either side.

Q What are you telling the Russians?

MR. BURNS: We're telling them exactly that in private. That's exactly what the Vice President communicated to President Yeltsin and Prime Minister Chernomyrdin in his meetings with them a month ago. It's what Secretary of State Christopher has advised Foreign Minister Primakov. It's what the President has talked to the Russian leadership about: that there is no military solution here.

And that's our message for the Chechen rebels. We do not have a day-to-day relationship with them, of course. We don't speak to them. But our message to them publicly is, these kinds of tactics will not resolve the situation, and they will just add to the deaths and the bloodshed in Chechnya.

Q But German Foreign Minister Klaus Kinkel had a meeting with Yevgeniy Primakov and suggested that the Russians should consider giving Chechnya more autonomy.

MR. BURNS: That is a question that the United States believes is up to the Russian Government to decide and to work out in negotiations with the Chechen rebels. We're not going to offer free advice in a very, very difficult situation for both sides.

We believe that if they can get to the negotiating table and commit themselves to some kind of negotiated compromise outcome, they can achieve that with the Chechens and the Russians together.

I don't think it's helpful for the United States to offer any kind of public advice.

Q Nick, Vice President Gore, when he was in Moscow, he came out of the meeting with Boris Yeltsin -- although it was postponed until he met with him -- with a clean bill of health for Mr. Yeltsin. I understand now that Mr. Yeltsin is going to be gone for a couple of months of maybe R&R. Do you have any concern or worries about the health of Boris Yeltsin here in the U.S. Government?

MR. BURNS: We know that President Yeltsin has had some health problems in the past. We're quite well aware of that. It is not up to us to comment, obviously, on the status of his health. We do not have a good understanding of that. That's up to the Russian Government to comment on.

Obviously, he's just been elected. We have a very, very productive relationship with him. We certainly hope that his health is good and improved, and we hope that we'll have an equally good relationship with him in the next four years, as we've had in the last four.

Q By him appointing, I believe, three people to run the government or the Russian administration in his absence, are you having also some concern about maybe if his health will deteriorate that -- and this is not a matter of hypothetical situation, because he has been sick for a long time -- that a power struggle will erupt in Russia over who is going to be the leader?

MR. BURNS: I think we need to set the record straight here, with all due respect, Mr. Abdul-Salam. President Yeltsin is going to be inaugurated tomorrow for his second term as President for four years, and that's a very great day for him and for the Russian population.

There is a degree of political stability in Russia that has not been present for many years. There is legitimacy now about his government and about his rule, because he was elected in free and fair democratic national elections. I think we ought to take a step back and pause and congratulate the Russians for what has gone right in their system.

I would also take issue with some of the reporting this morning in a major American newspaper about a coming economic collapse in Russia. We have a very, very good understanding of the Russian economy, because we've been centrally involved in the effort to help have the IMF and the World Bank and the United States and Germany and others extend economic assistance. That's not our impression at all of the Russian economy.

We think these prospects of doom and gloom are greatly exaggerated. Our own impression is that there's a degree of economic stability in Russia now that surpasses any other time in the last five years, since the collapse of the Soviet Union. The Russian economy has clearly bottomed out and is improving. Look at all the macro-economic indicators, and they'll tell you that.

I'd also say that President Yeltsin, at least as far as I know, has not given any indication that somehow he's leaving Moscow and is going to turn over the reins in any formal way to anyone else in the government. He remains President of Russia. He has reappointed Prime Minister Chernomyrdin as Prime Minister. He's made a very, we think, very outstanding appointment for Chief of Staff in Mr. Chubais. He's appointed General Lebed to be his adviser for internal crime and corruption and security issues. These are all very competent men, and we think the Russian Government is in good hands.

So I'm trying to push against some of the histrionics in the press that somehow things are falling apart. We think things are actually coming together, and that's our objective view.

Q Can I ask you to respond specifically to the report that I think you're obliquely responding to? The report suggests that Russia is headed for an economic crisis this fall that could require a bailout larger than the 1993 Mexico rescue package. What does the Administration think about that?

MR. BURNS: We think that's grossly exaggerated. We think that the fear of a financial crisis in Russia is overblown. The situation, obviously -- ask any Russian, ask any Russian Government official -- is not perfect; hasn't been perfect for many, many years. But the fact is -- and I think it bears repeating, David -- compare August 1996 to any other August of the last five years. The Russian economy is on a much surer footing.

It has a very low monthly inflation rate, just over one percent. It has a lower unemployment rate. The Russian Government and free- market system have been able to create a stock market, a bond market, very rich investment coming from overseas. There is hope now that wasn't present two or three or four years ago.

We are not aware of any financial indications that would lead us to believe that there is an impending crash this autumn, as was predicted by an article and a reporter in The Washington Times. The Russians did miss some targets in their IMF payments in July -- you remember this -- just over the last couple of weeks. The IMF postponed some credit transmissions to Russia.

But the IMF and Russia have been talking. They say they can work these problems out, and we believe that the conditionality present in the IMF and World Bank's programs within Russia should be continued. But we do believe that all these reports are greatly exaggerated, and there's abundant evidence to counteract this report.

Q Nick, you are giving us estimates of the State Department or these are official figures of the United States Government or international organizations?

MR. BURNS: I'm giving you the appraisal of the United States Government. We have a very keen understanding -- the Treasury Department does, the State Department does -- of the status of the Russian economy. We're very close to the situation. This is not something that we have a dim understanding of. It's a very detailed understanding, and we very much disagree with this report.

Q Nick, there's another report in a another major American newspaper that they had about a week ago that President Yeltsin is going to be going to the Mayo Clinic for open-heart surgery. Can you confirm/deny if he applied for a visa?

MR. BURNS: I know nothing about that, Sid. I can't say anything, because I saw one press report about this, and there's no way I can confirm it. I never heard anything to confirm that.

Q Would he need to apply for a visa to come to the United States?

MR. BURNS: Hypothetically, any foreigner coming to the United States, anyone, needs a visa, of course. President Clinton needs a visa to go to Russia.

Q Can you take the question as to whether he's applied for a U.S. visa, please?

MR. BURNS: I'd be glad to take that question. I wouldn't lead you in the direction of this story, however. I'd be glad to take the question. Because I've never heard anything about it, Sid. In all the time that we spend internally here talking about things, I've never heard any indication that that's what his plans are.

Q A very respected American paper now had two stories on it, so it bears some --

MR. BURNS: I have great respect for the American press, but you can't believe everything that you read. (Laughter) Especially on that subject. Exactly. No, but I understand why you're asking. I'll be glad to take that question for you.

Q Out of curiosity, are privacy concerns being issued here?

MR. BURNS: I don't know. We'll see. We'll see. I'll have to confer with our experts here in the building.

Q Nick, another subject. The wave is still rising again as to the sanctions against Iran and Libya Act 1996 from Europe, Japan, Canada. What is the United States doing to at least appease the Europeans and the other allies' attitude?

MR. BURNS: It's not a question of appeasing. We are trying to explain the law as we understand it. We are trying to explain how we intend to implement it. We haven't answered all those questions ourselves as a group here in the State Department, working on that issue of how you implement this law.

I think that what we hope now is that after the initial reaction that we've seen from Europe, which has been quite aggressive, that we and the Europeans will be able to talk quietly about this and not give the Iranians the pleasure of seeing this debate in the West. After all, the focus of this legislation ought to continue to be directed at Tehran, which is a major terrorist state, and at Tripoli, the Libyans.

It would be a shame if the Europeans and the Americans debated this ad nauseam for weeks to come, and that the focus and the spotlight was shifted on us and not where it should be properly applied, and that is on Tripoli and Tehran. They're the ones who are terrorist states and are supporting terrorist groups. We're simply asking the Europeans to join us in multilateral action against both of these countries.

There's very little prospect of that, because the Europeans have made clear they're not going to go along. But we are in this for the long haul. The United States is prepared to stand alone and to face up to a worldwide problem of terrorism, much of which is being caused by Iran. We're prepared to face that very squarely, and, if the other countries don't want to go along, we think sooner or later out of their own self-interest, because they are more often targets than we are, they will join us in this.

Q A follow-up, please. You are giving the impression that you are asking the Europeans and other allies to just keep quiet about it -- discuss it in closed doors or something, because it pleases the Iranians and the Libyans?

MR. BURNS: I think it would be most unfortunate if all of the public discussion centered on the differences that we clearly have with European governments, with Canada and with other countries around the world. We ought to all agree that at least we ought to keep the pressure up on Tehran and on Tripoli to end their support for terrorism around the world. Don't you think so? Doesn't that make sense, because we have incontrovertible evidence, in the case of Libya, that there are two suspects in the bombing of Pan Am 103? In the case of Tehran - that they're a major supporter of many of the Middle East terrorist groups that are attacking Israel, the United States and European countries.

Q Nick, on that question, did the United States consult quietly with the Europeans before the bill was signed into law?

MR. BURNS: At length. We kept the European governments apprised while we negotiated this bill with the Congress that took many, many months. We didn't want to surprise our allies and our friends in Europe and Asia. So, yes, I think they have as good an understanding of the bill as we do in many respects. Certainly, their local ambassadors, their ambassadors here in Washington, do. We want to appeal to them again to look at the reasons why Republicans and Democrats came together in an election year to support this legislation. Republicans and Democrats agree on very little, but they do agree that we need a strong, assertive campaign against terrorist states.

Q On this study group, which is looking at how to implement it, does that imply that there is no agreed policy on how it should be implemented now?

MR. BURNS: In the case of any bill like this -- and Helms-Burton is the best, probably, relevant example for you -- you need to take the law and then decide, if you will, what the implementing instructions will be, so that Congress and the Administration agree on how the Administration will execute the law. That's normal.

I just mean to say that we want to get back to the Congress and tell them how we intend to operate in the hypothetical situation that Company X puts $50 million into Iran's gas/oil industry -- no, I mean, anything above 40, but let's say 50 -- and how will we react in a situation like this.

Someone asked the other day, well, does it make a difference if it's a state-owned oil company. No, it doesn't. State-owned oil company, private oil company -- the law will treat it equally.

Q But there are mandatory provisions. The approach, forgive me, is beginning to sound a little bit like the approach the Administration took on Helms-Burton. It's the law, you know, you've got to carry it out, and you know and we know that there are waivers and loopholes and thresholds and all that. So I could come at you on this question several ways.

One is to ask you if in discussions with the Europeans you're pointing out to them that not in every instance does the Administration intend to apply sanctions; that there are -- you know, there are waivers. I won't call them "loopholes," because that suggests something dirty, but there are escape clauses in the law. Is that where the -- and, gee whiz, we're stuck with it, so we'll look at it again.

Or are you really -- does the Administration think that the law is the right thing to do? Do you intend to enforce it strictly? Do you intend, indeed, to punish foreign companies for trading with countries that you consider sponsors of terrorism?

MR. BURNS: Barry, I'm very pleased to agree with both of the propositions that you've put forward.

Q You can use both of them.

MR. BURNS: Well, I will. Let me try and see if --

Q You're a diplomat, right?

MR. BURNS: Let me try and see if I can convince you. First of all, it is the law. We have an obligation to administer it, and we do believe it's the right thing to do. The President wouldn't have signed it if he did not believe it was the right thing to undertake.

Secondly, one of the arguments that we're making to the Europeans is - amidst this great hue and cry about this legislation - from Europe, is it is narrowly drawn. There is a great degree of flexibility that is built into this legislation. It is focused on a particular sector of the Iranian and Libyan economies -- the oil and gas sector.

There are six different types of sanctions listed in the legislation, but the President has the flexibility to employ two. He has the flexibility to waive the sanctions, should we believe that any country beyond our shores has taken tougher measures against Iran or Libya.

So it gives the President, and properly so, the flexibility to implement this law, and there are a substantial number of waiver provisions. So we'd like to see, frankly, some of these European governments adopt tougher measures against Iran; and, should they do so, I think they'll be met halfway by the United States. There might be an ability for us to give sanctions relief to the companies of those countries.

Q Just send them an olive branch.

Q (Inaudible) business with Iran --

MR. BURNS: Well, very much. I mean, one of the problems I think that we've had in our public discussion with many of our allies on Helms-Burton and on this legislation is that we've lost sight of the object of both bills: Fidel Castro, on the one hand; and, on the other, Qadhafi and the Iranian leadership.

We'd like to at least agree with our friends that we ought to keep the pressure on these autocrats who are sponsoring terror in the world, and in the case of Castro who are denying human rights to his own citizens.

Q We know the bill has only prospective applications. Do I understand correctly that if a particular European country in other ways adopts a tougher policy toward Iran and toward Libya, a company in that country that signs an energy pact that's above the threshold figure still might be able to avoid sanctions?

MR. BURNS: There are provisions in the law, agreed to by the signers of the law, everyone involved, that would allow us to have that degree of flexibility to waive the sanctions if we felt, for the greater good of the objective here, that the countries involved were taking correspondingly tough measures against Iran and Libya.

Q But they would still be doing business, which is the main point of the bill.

MR. BURNS: I think it will meet the duck test. We'll know it when we see it. If one of these European countries decides, for instance, that talking isn't going to do it -- that there has to be some kind of action to get the attention of the Iranians, because, see, we don't believe that critical dialogue can be effective -- then we'll know it, and you'll know it, too, by looking at the actions of that government. It won't be hard to discern.

Q How much is the object of the bill?

MR. BURNS: The object of the bill is to influence the behavior of Iran and Libya by pressuring them, by tightening the economic noose on them; by getting our European allies to agree that multilateral action will be more effective than unilateral action.

Right now the United States is standing alone in the world on this legislation. We are prepared and comfortable to stand alone, but sooner or later they're going to have to join us, because we don't believe that the critical dialogue is going to convince Iran to stop its nuclear weapons production program, research program or its support for terrorist groups.

Q Nick, what can you tell us about today's demarche by the European Union to the State Department?

MR. BURNS: I heard about the possibility of a demarche, but at the time I came out here, it had not taken place, as far as I know.

Q (Inaudible)

MR. BURNS: I was told by some people that the Europeans might be making a formal demarche to our European Bureau here, but when I came out here, I was not told that it actually happened.

Q Nick, can I ask you about something that hasn't come up in a while but it's tangentially related -- the Libyan chemical weapons plant that is supposedly being built under the mountaintop. I guess when that last came up here, we were going to address it by diplomatic means. (A) Do you have a progress report; (B) how does that factor into the problems with the allies over the sanctions bill?

MR. BURNS: It's another indication of why Libya ought to be isolated. We continue to have very strong concerns and very strong evidence that Libya is attempting to build a chemical weapons production facility. The Libyans very disingenuously took a bunch of reporters out to a site and said, "See, we're not building them. There's an empty room here."

I wouldn't trust that. I don't trust the Libyans to be honest and aboveboard with anybody -- reporters or foreign governments. We think they are attempting to build such a facility. We're very concerned about it. We have sent messages to the Libyans about it, and we've talked to all of Libya's neighbors, including Egypt, about it.

Q And last we discussed that, I think we were also going to be talking with our friends in Europe.

MR. BURNS: Yes, we are.

Q Is the squabble over the sanctions impeding the effort to impede that plan?

MR. BURNS: Even if some of these European governments are opposed to the Iran/Libya sanctions bill, they ought to continue to keep their sights on the illegal activity that's clearly underway in both Iran on nuclear weapons and in Libya on chemical weapons.

We can't turn our sights away from this. We can't just turn a blind eye because we're interested in corporate profits on a short-term basis, and just pretend the problem doesn't exist. Iran and Libya are threats to Europe, as well as to the United States. The sooner we face the threat with some effective international action, the better off all of us will be.

The United States is not predisposed to ignore the threat. We're going to face it squarely, and we are facing it squarely, to the disadvantage of our own companies. Conoco had to leave a very prosperous, profitable investment in Iran. Another company, a French company, stepped into the shoes and took advantage of that void. We think that's unfair, and that's one of the reasons why this legislation passed and was signed by the President.

Q Nick, President Mubarak last month (inaudible) spoke of the White House about not punishing a complete nation -- punishing the perpetrators of any terrorism or terrorism acts; and, since you are talking about Iran's support of terrorism and Libya's support of terrorism, what are the measures that ought to be taken in order to help the Iranian people and the Libyan people against the people who are committing acts of terrorism against the West, especially the United States?

MR. BURNS: As a country, we can only deal with governments. We can't solve all the problems of other societies, but we can do something about threats to our own people that emanate from dictatorships like Libya and terrorist nations like Iran, and that's what we're trying to do with this legislation.

Q What happened to the policy of constructive engagement and U.S. engagement. I think in the case of South Africa there was constructive engagement to bring about some changes in the policies. And this is what the European allies are saying, that you are accelerating the tension between you and these countries and not reducing -- not "taming the shrew" in any way to try to bring them about to civility, if you will.

MR. BURNS: There's no common blueprint that works everywhere in the world. Constructive engagement worked in South Africa. The Europeans have tried constructive engagement with Iran. It's called the "critical dialogue." It has failed. It's time to adopt more serious and tougher actions against Iran. The United States is providing that leadership, and sooner or later, we are convinced that at least some countries around the world will join us in this. It's failed. Talking to the Iranians failed. It didn't work.

Q Now that the United States is putting pressure on its allies, although they are somehow in difference, I think this is the main point of difference between the United States and Europe. The Europeans do not see eye to eye with the United States as to the way of dealing with these two countries. It is the point. So it seems that you are not able to convince your allies in Europe and in other countries that these two countries are still going on with terrorism, still supporting terrorism.

MR. BURNS: And we're convinced that we're right, and we're going to proceed the way we've already decided, in the hope that the others will come along.

I think we've probably done as much as we can do on this issue. Is there another issue? Yes.

Q Do you have anything latest on the CTBT -- Comprehensive Test Ban Treaty?

MR. BURNS: Well --

Q Do you have --

MR. BURNS: We continue our efforts to try to move forward towards an agreement so that a treaty can be signed this autumn.

Q Do you have anything on -- did the Secretary of State meet the Indian diplomat here today?

MR. BURNS: Yes. The Secretary met alone with the Indian Ambassador, Ambassador Chandra, today. The discussion focused solely on the Comprehensive Test Ban Treaty. The Secretary noted that the goal of a Comprehensive Test Ban Treaty has been the longstanding goal of some of India's greatest leaders, since the founding of India, and some of America's greatest leaders, including President Kennedy 30 years ago.

The United States is still urging India to sign the Comprehensive Test Ban Treaty. However, we will continue to expect in the negotiations that India not seek to frustrate the will of the international community on this particular treaty.

We believe that India should allow the international community to move forward, to finish discussions about this treaty, so that leaders of the world can convene here in the United States just in a month or so to sign this treaty. That was the basic message the Secretary gave to Ambassador Chandra this morning.

Q Any response from him?

MR. BURNS: From Ambassador Chandra?

Q Yes.

MR. BURNS: You'll have to ask Ambassador Chandra. I don't want to characterize his own position.

Q When will the deal for oil-for-food will enter into effect that was signed -- announced yesterday -- something about it yesterday.

MR. BURNS: Okay, we're jumping around here. I just want to make sure -- is there a follow-up on CTBT?

Q Yes. How is India preventing international discussion on this?

MR. BURNS: India is not preventing discussion, but the Indian Ambassador in Geneva stood up this morning and said that India would in essence perhaps seek to block this agreement from going forward. The message that Secretary Christopher gave to the Indian Ambassador was twofold: we hope that India will decide to sign this treaty, which we think is consistent with the long-term national aspirations of India, going back to Nehru and to Gandhi.

It has certainly been the long-term aspiration of the United States, going back to President Kennedy. If India cannot do this, we certainly hope that India will not stand in the way of the international community -- the great, great majority of countries who do want to go forward, to move from Geneva to New York, the United States, and to have this treaty signed.

Q Nick, did the Secretary also inform the Indian Ambassador that the five known nuclear powers have accepted the compromise with China?

MR. BURNS: I think the Secretary gave him a general sense of our view of the negotiations. I know from taking to the Secretary just a little while ago that he believes that things are moving in the right direction; that indeed we've made some progress, but that we have not completed these negotiations. We have not overcome all the obstacles to a Comprehensive Test Ban Treaty.

We are profoundly aware of the difficulties of these negotiations, but we are determined to move ahead. In that, we are very pleased to have the support of some very important countries around the world. You know the Secretary and Foreign Minister Primakov made a joint statement together in Jakarta about Russia and the United States' wish to move forward together on this.

We've had some good discussions with the Chinese, but I don't want to characterize them in any detailed way.

Q So you can't say whether the compromise on inspections with the Chinese is now a done deal?

MR. BURNS: Sid, I think you understand I just don't want to go into the privacy of these negotiations, because I don't want to say anything that would harm them.

Betsy.

Q Do you have anything on the air transport spat between Venezuela and the United States?

MR. BURNS: Yes, I do. I know that we are engaged in some very difficult, important discussions with the Venezuelans. I know that yesterday the Venezuelan Civil Aviation Authority grounded three American Airlines aircraft at Maiquetia International Airport outside of Caracas, and that essentially they interfere with the ability of these aircraft to depart from Venezuela, as scheduled, with passengers.

As a result of that action taken by the Venezuelans, American Airlines cancelled some of its August 7 and all of its August 8 flights to Venezuela. American operates three daily Miami-Caracas round-trip flights and one daily New York-Caracas round-trip flight.

United Airlines, which operates round-trip daily service to Venezuela from Miami and New York, has cancelled all of its operations yesterday and today as a consequence of the actions of Venezuela.

I know that the Department of State, the Department of Transportation and the FAA are now meeting here in Washington with Venezuelan authorities about this situation. The Minister of Transportation of Venezuela is here in Washington today for talks with Secretary Pena, and he also will be meeting with Assistant Secretary Jeff Davidow.

We are raising our concerns with the Venezuelans about the actions taken by their civil aviation authorities yesterday. The actions of the Venezuelans have caused significant disturbances to thousands of international air passengers, and I know that the United States and the American airlines -- the United States airlines: American and United -- are trying to find alternative routes for their people.

We believe the root of this is the fact that there was an assessment by the Federal Aviation Administration in May 1995 that found Venezuela's Civil Aviation Authority not to be in compliance with international safety standards for their oversight of their own air carriers. The FAA has been trying to work with the Venezuelan Civil Aviation Authorities to address these concerns, so that they can be found to be in compliance if they improve their standards.

That seems to be the major problem here. It is not appropriate to take this kind of reciprocal action against the American air carriers just because the Venezuelans have a problem with their own failure to meet international safety standards.

Q So you think this is more a problem of, say, maintenance and crew training by this airline than airport safety issues.

MR. BURNS: I think the crux of the problem is that Venezuela needs to improve its own civil aviation standards, and they need to meet recognizable international standards, and that is not the case. We are quite willing to continue working with them to see if these standards -- their performance can be upgraded.

Q Wasn't this precipitated by the United States preparing to downgrade Venezuela's security status by one notch?

MR. BURNS: I don't know if the Department -- if the FAA was planning on downgrading it further. I just want to point you to the fact that for nearly a year and a half now there has been a recognized problem that we have brought to their attention and we've been willing to work with them on this, and we still are willing to work with them. We hope very much that Secretary Pena and the Venezuelan Minister will have successful talks today so that this problem can be righted, but it's simply not right to take it out on United Airlines and American Airlines.

Q So you mean Venezuela is wrong?

MR. BURNS: I'm talking here about Venezuela. There have been instances around the world where other countries have not been in conformance either.

Q Can I go back to my question?

Q Do you have a list of them?

MR. BURNS: I have to refer you to the FAA. The FAA is the federal agency that works with these governments on international air safety standards.

Q Just to clarify, on the discussions you're having with the Venezuelans, are these on legal grounds? Are you saying what they're doing is illegal; are you saying it's a bureaucratic disruption?

MR. BURNS: I think there are two things at work here.

One is that we need to have -- we hope -- a successful series of talks on the standards that need to be applied so that we can be assured that Venezuela's International Airport -- Caracas' -- meets international standards.

Second, we want to make sure that the Venezuelans are open to reversing some of these decisions that have effectively grounded American Airlines and United Airlines in and out of Caracas.

Q I'd ask the question again: Is it illegal for them to do this, or is this just a disruptive tactic?

MR. BURNS: I'm not a lawyer; I don't know if it's illegal or not. You might ask the Department of Transportation, which has the central role here; but we're disturbed by it, Charlie, and we're trying to convince the Venezuelans that we ought to try to redress the situation.

Q Nick --

MR. BURNS: Still on this issue?

Q Do you know -- has President Clinton been in touch with President Caldera?

MR. BURNS: I don't believe that's the case. I believe this been taken so far as high as the Ministers in both governments.

Q Can I have a status report on oil-for-food agreement, which was made by the Ministers?

MR. BURNS: Yes. As you know, Ambassador Albright said that we would go ahead. We are going ahead. The United Nations now needs to work on the implementing steps to be taken.

I understand that might take a few days, or perhaps even a few weeks, before this program is fully underway. That rests with the United Nations.

Q The Turkish Government yesterday, through a specific agency of its Minister of Defense, is questioning now Greek sovereignty of up to l,000 Greek islets -- rocky islands and small islands in the entire Aegean Sea, three miles off the Greek and Turkish coast, including l4 of them surrounding the Greek island of Crete. Since your Government is mediating actively between the two countries, I'm wondering: What is your position on this needless provocation against the territorial integrity of Greece?

MR. BURNS: I cannot confirm, Mr. Lambros, the report that you've given to us. I'm unaware of it about those particular incidents, but I can tell you that we remain dedicated. The United States remains dedicated to trying to work with Turkey and Greece to resolve their many problems concerning the Aegean.

Q Thank you.

Q In other words, it's (inaudible).

MR. BURNS: I've not seen that report, no. I can't confirm it.

(The briefing concluded at 1:59 p.m.)

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