US Department of State 

Dispatch, Vol 1, No 11, November 12, 1990


Economic Challenges in the US-Japan Relationship

McCormack Source: Richard McCormack, Under Secretary for Economic Affairs Description: Remarks before the North Carolina-Japan Forum, Raleigh, North Carolina Date: Nov 1, 199011/1/90 Category: Speeches, Testimony, Statements Region: East Asia Country: Japan Subject: Trade/Economics, Democratization [TEXT] I am pleased to have the opportunity to open this conference, which addresses a number of key topics affecting the US-Japan economic relationship. Both countries face economic challenges. The way we respond to them will have a significant impact on the world economy and our two countries. I hope that in these next few days, you will be able to thoroughly explore the problems--and the opportunities--our two countries face and begin to identify productive solutions as well. On the US side, we have had to deal with two major difficulties since the summer--the conflict in the gulf and the budget crisis. Our diplomatic and military responses have moved smoothly and rapidly to meet the Iraqi challenge. However, on the domestic side, our ability to deal with the budget has been anything but smooth and rapid. Our success in solving both challenges will define the country we will be--and the world we will live in-- as we move into the 21st century. Today, I would like to discuss the challenges Japan is now facing in its economic and political affairs. On the economic side, Japan is facing a new kind of economic adjustment. It is struggling to find ways to allow consumers to share the benefits of the phenomenal post-war growth and wealth increases. Japanese citizens have supported the industrial successes by hard work, high savings, and postponed increases in living standards. Many Japanese feel it is now their turn for a greater share in the results. Economic challenges are nothing new to the Japanese, and though there may be some rough spots in the short term, experience shows that the Japanese economy often emerges from difficulties, like the 1970s oil shocks, in an even stronger position. This is partly because when the Japanese government and business establishment believe change is necessary, a plan is developed, and it is implemented.
Japan's International Challenge
What is new today is the international political challenge Japan is now facing. The Persian Gulf crisis is challenging the Japanese to go quickly beyond their economic role in the world to a political one. Their response to the crisis has, therefore, forced the Japanese to confront some very basic issues--about themselves and the kind of country they would like to be. In the early days of the crisis, Japan acted quickly--before the UN resolution--to impose economic sanctions on Iraq and freeze Kuwaiti assets in Japan. Our government then sought to work with Japan and other countries to develop a true multinational effort in the Persian Gulf. Japan is in a position to make important economic contributions to the gulf effort, and it also is considering how it can provide some forms of non-combat personnel support. They have decided to provide a total financial contribution of $4 billion, including $2 billion to the multinational defense force for transport, housing, and purchases--[to be procured] largely from US sources-- of other non-military goods for use by US and other multinational troops in Saudi Arabia. Also they have pledged $2 billion in economic assistance to "front-line states"--Egypt, Turkey, and Jordan--and approximately $22 million in aid to refugees stranded in Jordan. This Japanese contribution is substantial and second only to Saudi Arabia and Kuwait in size. Yet Japan has been repeatedly criticized by the Congress, the public, and even by [the cartoon strip] Doonesbury for not contributing enough to the defense of its economic interests. A large part of the problem is, I think, that Japan's announcement of its contribution came too slowly for many Americans who value swift and decisive action. It took 6 weeks from the time of the Iraqi invasion for Japan to announce its full package. During that time, congressional impatience grew, and Congress passed a harsh resolution against Japan. Unfortunately, the timing of the congressional action and the timing of the Japanese announcement only reinforced the perception in this country that harsh action and pressure are the only ways to move the Japanese. How Japan responds to the crisis in the Persian Gulf has broad implications for Japan's international role and the world's view of Japan. The Japanese are now in the process of defining their role in an interdependent world. They must decide on Japan's future and the kind of country Japan wants to become. Japan is a country which rightfully should be a player in world affairs, not a spectator or merely a financial underwriter. We support its active participation in world affairs and look forward to developments over the next few months.
Economic Problems
Turning to the economic side, I note that Japan's economy is facing some strains and problems. Given Japan's heavy dependence on imported energy, the crisis in the gulf may add to existing inflationary pressures. Since the first oil shock of 1973, Japan has taken steps to decrease its dependence on oil from 77% to less than 60% of total energy needs. But of this oil, 68% comes from the Middle East, and 53% is shipped through the Strait of Hormuz. With appropriate economic policies, the consensus view is that Japan's economy can take prices at $30-$40 per barrel in stride. Latest projections following Iraq's invasion of Kuwait show that [Japan's] GNP growth will remain at 5.1% this year, falling to 3.9% in 1991; projections show that inflation will increase slightly due to higher energy prices but will remain relatively low at 2.8% for 1990 and 1991. In addition to solid projections of continued growth, Japan has two economic cushions: a trade surplus and budget surplus, each equal to 2% of GNP. Japan's strong economic performance, combined with its dependence on imported oil, leads naturally to high expectations with respect to Japan's contributions to multinational efforts in the Persian Gulf. In spite of the solid growth of the Japanese economy, the financial structure in Japan has been a source of concern, particularly the prices of corporate stocks and land. Land prices in Japan have exploded to the point that the total market value of all the small mountainous islands of Japan is, I am told, ten times the total value of all the land in the entire United States. The small estate of a few acres in Tokyo where the Emperor has his palace is worth, in pure square yardage, more than the entire state of Florida. A single yard of land can cost a quarter of a million dollars. The price of land continues to rise. The latest figures show that land costs in September were up more than 13% [over] the previous year. To young families, the stratospheric price of land means that affordable housing is almost impossible to find. Japanese birth rates are collapsing as young couples are increasingly unwilling to raise children in present cramped conditions. Many Japanese spend hours commuting each day, and yet, in the face of an excruciating shortage of land, there are still thousands of acres of land being used to grow rice within the Tokyo metropolitan area. These stratospheric Japanese land prices are almost entirely the result of artificial shortages created by archaic tax and zoning regulations coupled with a speculative fever unlike anything that has been seen in my lifetime. During the 1920s, however, the United States had an overheated stock market. There were booms and busts in land--for example in Florida--which wiped out thousands of investors. Last year, it became clear that Japan was running the risk of repeating the US experience of 1929. The Bank of Japan and the Ministry of Finance have begun to take steps to limit the speculative excesses and let the air out of the stock market and land bubbles before they burst in an uncontrollable fashion with economic damage extending far beyond Japan. The easy flow of financing has been somewhat tightened. The stock market, which had risen to levels that bore no relationship whatsoever to price/earning ratios, has now fallen about 35% since its high at the beginning of the year, erasing nearly $2 trillion from the market's collective value. The difficulty, as I have mentioned, is to let air out of the bubble without it bursting, with potentially great damage to the economy. Since banks own stocks, their assets decline with the stock market. Because of the recent fall in stock prices, there are indications that many banks will not now meet new capital adequacy requirements by 1993. Banks will have to face up to a liquidity crunch by selling assets, raising new capital, and cutting back on lending.
Capital Outflow Slows
On the heels of these developments came the gulf crisis, bringing with it uncertainty over higher oil prices and increased inflationary expectations. These developments exacerbated banking-sector problems and are further affecting Japanese patterns of financial investment. Although the market has not yet digested all these changes, the Japanese enthusiasm for investments in foreign financial instruments has been dampened. Some funds invested abroad have been pulled back to Japan to cover stock loans and to seek higher interest rates. One possible implication for the United States is upward pressure on interest rates; the same holds for many Japanese borrowers, including the manufacturing sector. Some companies, for example some major automobile manufacturers, have built up large cash reserves which will provide a competitive edge as capital costs rise. The outflow of Japanese capital is definitely slowing down. There are obvious reasons: Japan's global current account surplus declined from a peak of $87 billion in 1987 to $49 billion in 1989 and moved to $22.6 billion in the first 7 months of this year. Japan's interest rates are rising, and previous exchange rate risks further decreased the attractiveness of some US holdings. The Japanese did not actively participate in recent Treasury bill auctions. There are reports that Japanese institutions were net sellers of American securities this year. They are now moving more to direct investment, which is aimed at industries here and in Europe that can strengthen their competitive position. This brings me to the second part of my speech. Japan has become a domestic issue in the United States. We see polls which label Japan as a greater threat to this country than the Soviet Union is. Part of the reason for this is the correct perception that the Soviet military threat has decreased. But it also reflects a twofold concern about our economic position: apprehension that the United States is in decline and that the Japanese have gained economic strength against us. We see fears of Japanese investment despite the fact that European purchases of US companies are still considerably higher than those of Japan. Japan now owns $55 billion in US assets--a small sum compared to the close to the $8 trillion total. What catches attention and generates fear is the idea that this investment is concentrated in leading-edge technology companies, or in famous American companies, the so-called trophy investments. If we go beyond the surface exchanges, a hard question is why such assets are for sale, and why American companies are not willing or able to make these purchases themselves. It may be that the Japanese are taking the longer term view more into account than Americans who are tied to short-term profit accountability. Both countries are undergoing structural change, and much of the tension in our relationship can be attributed to the new realities of the relationship and the difficulties in adjusting to it. Japan and the United States must make changes in our domestic economies--the United States to make our economy more competitive and the Japanese to make their markets more open to the world. Japan has benefited greatly from the open world trading system and is also now a financial superpower. But we believe Japan still has not provided a reciprocal degree of openness in its trade and financial systems. While some are fixated on the amount of our trade deficit with Japan--about $40 billion last year alone-- the real problem is not merely the number but the degree of access foreigners have to Japanese domestic markets. The Japanese system still is not nearly as open as ours. The former West Germany also has a large global trade surplus, greater in 1989 than Japan's, though Japan's GNP is twice as large. Yet West Germany has not been subject to the same kinds of criticism as Japan receives. People have different perceptions about the openness and fairness of the two countries, and facts indicate that this view may be valid. For example, foreign direct investment in West Germany accounted for 17% of its assets. The same figure in Japan is 1%-- and acquisitions are not getting any easier. German cars are highly competitive, yet 30% of the autos sold in Germany are imports. In Japan, the figure is 4%, and, incidentally, a large majority of the 4% are German cars. The question is access and fairness. Americans believe that they are getting access to the German market and that they are getting a fair deal there.
A Many-Sided Relationship
The United States has a many-sided relationship with the Japanese- -cooperation in aid, in multilateral forums, on political issues, and in terms of their contributions to US forces in Japan. But the weakness in our relationship has, for years, been in trade and economic matters. Unless our economic relationship is on a sound footing, our two countries cannot have a true partnership, especially in an era when economics and the importance of markets are crowding out the Cold War as mass-based issues of concern. Our deficit with Japan is coming down, but a $40 billion trade deficit with Japan is still politically unsustainable. Our trade policy toward Japan has several parts. A main emphasis is coordination in multilateral fora, with successful conclusion of the Uruguay Round next month our major concern. A second part of our economic strategy is coordination of macro-economic policies to foster improved economic balance, bilaterally and multilaterally. This coordination is likely to gain importance given the uncertainties we all face due to oil price increases and supply disturbances, threat of inflation, and possible recessionary pressures. A third part of our strategy is negotiations on specific market access problems. In the last few months, we have had successful resolution of several Super 301 cases on satellites, wood products, and supercomputers, and other agreements on amorphous metals and telecommunications. Our trade negotiators have a solid record of progress on market access problems, and we will continue to press for resolution of problem areas. Finally, the US government is working with the Japanese on questions of structural changes that will identify and remove barriers to market-determined trade and investment flows. We need to reduce Japan's export orientation and free up access for imports. A major part of this policy is the Structural Impediments Initiative (SII). In June, the United States and Japan concluded a year of intensive talks with a joint report which commits both countries to comprehensive measures to reduce structural impediments to the flow of trade and investment and which will help foster balance-of-payments adjustment. The report is not an end in itself but the beginning of an ongoing process. It contains a blueprint for action that must be fully implemented by both countries before we can claim success for this diplomatic exercise. SII is a two-way street. On the US side, we are committed to addressing our budget deficit, low savings rate, and educational and worker training questions. The Japanese have committed to change in six areas of structural impediments: savings and investment imbalance, the distribution system, land use policies, keiretsu [hierarchy], exclusionary business practices, and pricing. As someone who has spent his life in the political side of US foreign policy, at the White House, Treasury, State Department, and Congress, I have observed that every decade or so political parties must look at themselves and the world around them and ask if their program is still suitable for a changing external environment. The Reagan administration, and now the Bush administration, have made a conscious effort to broaden the constituency of the Republican Party, include new groups, and address new issues and concerns. Many observers believe that the Liberal Democratic Party of Japan faces a similar challenge, to address the needs and interests of the new generation of Japanese urban voters. In any political system, changes can come from the bottom up or from the top down. However, statesmanship at the top is easier and less socially wrenching than the alternative. Many Japanese believe that it is not a sustainable situation politically for a country like Japan--one of the richest nations on earth--to have its wealth so unevenly deployed that less than half of Japanese homes are hooked to a sewer system. Japanese pay 40% more than Americans for the same goods traded between the two countries. The Japanese people have worked long and hard to build up their country and wealth. This massive wealth should, in the view of many Japanese, produce more benefits and a better life for the Japanese people. More internal consumption will also encourage Japanese imports and reduce trade imbalances in the international economy. That is what we are trying to achieve in the Structural Impediments Initiative talks. Today, I have surveyed some of the important facets of our relationship with Japan--the constructive Japanese response to the crisis in the Persian Gulf, our close economic ties, and the need for better balance in our economic relations. Through the Structural Impediments Initiative and other bilateral and multilateral contacts, we have been working toward this better balance. For us to achieve the economic and foreign policy goals that our countries share, both of our countries--the United States and Japan--will have to make a major sustained effort throughout the decade of the 1990s.(###)
US Department of State Dispatch, Vol 1, No 11, November 12, 1990 Title:

US Increases Troop Commitment In Operation Desert Shield

Bush Source: President Bush Description: Opening remarks at a news conference at the White House, Washington, DC Date: Nov 8, 199011/8/90 Category: Speeches, Testimony, Statements Region: MidEast/North Africa Country: Iraq, Kuwait Subject: Military Affairs [TEXT] On August 6th, in response to the unprovoked Iraqi invasion of Kuwait, I ordered the deployment of US military forces to Saudi Arabia and the Persian Gulf to deter further Iraqi aggression and to protect our interests in the region. What we've done is right, and I'm happy to say that most Members of Congress and the majority of Americans agree. Before the invasion in August, we had succeeded in the struggle for freedom in Eastern Europe, and we'd hopefully begun a new era that offered the promise of peace. Following the invasion, I stated that if history had taught us any lesson, it was that we must resist aggression or it would destroy our freedom. Just ask the people of Kuwait. And the foreign nationals in hiding there. And the staffs of the remaining embassies who have experienced the horrors of Iraq's illegal occupation, its systematic dismantling of Kuwait, and its abuse of Kuwaitis and other citizens. The world community also must prevent an individual clearly bent on regional domination from establishing a chokehold on the world's economic lifeline. We're seeing global economic stability and growth already at risk as, each day, countries around the world pay dearly for Saddam Hussein's aggression. From the very beginning, we and our coalition partners have shared common political goals: the immediate, complete, and unconditional withdrawal of Iraqi forces from Kuwait, restoration of Kuwait's legitimate government, protection of the lives of citizens held hostage by Iraq both in Kuwait and Iraq, and restoration of security and stability in the Persian Gulf region. To achieve these goals, we and our allies have forged a strong diplomatic, economic, and military strategy to force Iraq to comply with these objectives. The framework of this strategy is laid out in 10 UN resolutions, overwhelmingly supported by the UN Security Council. In 3 months, the US troop contribution to the multinational force in Saudi Arabia has gone from 10,000 to 230,000 as part of Operation Desert Shield. General Schwarzkopf [Commanding General, US forces in Saudi Arabia] reports that our forces, in conjunction with other coalition forces, now have the capability to defend successfully against any further Iraqi aggression.
Increasing the Size of US Forces in the Gulf
After consultation with King Fahd [of Saudi Arabia] and our other allies, I have today directed the Secretary of Defense to increase the size of US forces committed to Desert Shield to ensure that the coalition has an adequate offensive military option should that be necessary to achieve our common goals. Toward this end, we will continue to discuss the possibility of both additional allied force contributions and appropriate UN actions. Iraq's brutality, aggression, and violations of international law cannot be allowed to succeed. Secretary Baker has been consulting with our key partners in the coalition. He's met with the Amirs of Bahrain and Kuwait, King Fahd, President Mubarak [Egypt], as well as the Chinese Foreign Minister, President Ozal [Turkey], [Soviet] Foreign Minister Shevardnadze, President Gorbachev [USSR]. He also will be meeting with Prime Minister Thatcher [UK] and President Mitterrand [France]. I've been heartened by Jim's appraisal of the strong international solidarity and determination to ensure that Iraq's aggression does not stand and is not rewarded. But right now Kuwait is struggling for survival. And along with many other nations, we've been called upon to help. The consequences of our not doing so would be incalculable because Iraq's aggression is not just a challenge to the security of Kuwait and other gulf nations, but to the better world that we all have hoped to build in the wake of the Cold War. And, therefore, we and our allies cannot and will not shirk our responsibilities. The state of Kuwait must be restored or no nation will be safe, and the promising future we anticipate will, indeed, be jeopardized. Let me conclude with a word to the young American GIs deployed in the gulf. We are proud of each and every one of you. I know you miss your loved ones and want to know when you'll be coming home. We won't leave you there any longer than necessary. I want every single soldier out of there as soon as possible. And we're all grateful for your continued sacrifice and your commitment.(###)
US Department of State Dispatch, Vol 1, No 11, November 12, 1990 Title:

State Department Gulf Crisis Information

Category: Fact Sheets Region: MidEast/North Africa Country: Iraq, Kuwait Subject: Democratization [TEXT]
: 202-647-0900 (24 hours) Questions or comments about the administration's gulf policy: 202- 647-6575 or 6576, Monday-Friday, 8:30 am-5 pm (Eastern Standard Time)(###)
US Department of State Dispatch, Vol 1, No 11, November 12, 1990 Title:

Country Profile: Bahrain

Category: Country Data Region: MidEast/North Africa Country: Bahrain Subject: History, Trade/Economics, International Organizations [TEXT] Official Name: State of Bahrain
Area: 692 sq. km. (267 sq. mi.); about four times the size of Washington, DC. Bahrain is an archipelago consisting of 33 islands, only five of them inhabited. Cities: Capital--Manama (1985 est.)--pop. 122,000. Other city--Al Muharraq. Terrain: Low interior plateau and hill on main island. Climate: Hot and humid from April-October, temperate from November- March.
Nationality: Noun and adjective--Bahraini(s). Population (1989 est.): 500,000 (66% indigenous). Ethnic groups: Arab 73%, Iranian 9%, Pakistani, Indian. Religions: Shi'a Muslim (over 60% of the indigenous pop.; Sunni Muslim (about 30%). Languages: Arabic (official), English, Farsi, Urdu. Education: Attendance--73%. Literacy: About 74%. Work force (1989 est.): 190,000. About 44% indigenous, 56% expatriate. Agriculture-- 4%; Industry and commerce--74%; Services--19%; Government--3%.
Type: Traditional emirate (cabinet-executive system). Independence: August 15, 1971. Constitution: May 26, 1973. Branches: Executive--amir (chief of state), prime minister (head of government), council of ministers (cabinet). Judicial--independent judiciary with right of judicial review. Subdivisions: Six towns and cities. Political parties: None. Suffrage: None. Central government budget (1986-87): $2.6 billion. Defense (1986): $134.4 million, or 9% of the published budget. Flag: Three-fourths red field with serrated line separating white field on staff side.
GDP (1988 est.): $3.6 billion. Real growth (est.): 2%. Per capita income (1988 est.): $8,495. Avg. inflation rate (1985): 0.3%. Natural resources: Oil, associated and non-associated natural gas, fish. Agriculture (1.5% of GDP): Products-- eggs, vegetables, dates. Industry (36% of GDP): Types--oil aluminum, ship repair, natural gas, fish. Services (62% of GDP): Banking, real estate, insurance. Trade (1987 est.): Exports--$2.4 billion: oil, aluminum, fish. Major markets-- Japan, Saudi Arabia, UK, US. Imports-- $2.7 billion: machinery, industrial equipment, motor vehicles, foodstuffs, clothing. Major suppliers: Japan, UK, US. Official exchange rate: 0.38 Bahraini dinar=US $1. Economic aid received: Significant budgetary support and project grants from Saudi Arabia, Kuwait, and the United Arab Emirates.
Membership in International Organizations
UN and most of its specialized agencies, Arab League, Organization of Arab Petroleum Exporting Countries (OAPEC), Gulf Cooperation Council (GCC).(###)
US Department of State Dispatch, Vol 1, No 11, November 12, 1990 Title:

Remarks to US Troops

Bush Source: President Bush Description: Remarks by President Bush at Hickam Airfield, Pearl Harbor, Hawaii Date: Oct 28, 199010/28/90 Region: MidEast/North Africa Country: Iraq, Kuwait Subject: Military Affairs [TEXT] Today in the Persian Gulf, the world is once again faced with the challenge of perfect clarity. Saddam Hussein has given us a whole plateful of clarity, because today, in the Persian Gulf, what we are looking at is good and evil, right and wrong. And day after day, shocking new horrors reveal the true nature of the reign of terror in Kuwait. In one hospital, dialysis patients were ripped from their machines and the machines shipped from Kuwait to Baghdad. Iraq soldiers pulled the plug on incubators supporting 22 premature babies. All 22 died. The hospital employees were shot, and the plundered machines were shipped off to Baghdad. But you cannot pull the plug on a nation. The invasion of Kuwait was without provocation. The invasion of Kuwait was without excuse. And the invasion of Kuwait will not stand. Iraq's invasion marks an outrageous breach of the peace, a broad-faced violation of the UN Charter. And by its actions, the Iraqi regime has shown its contempt for the very principles on which the United Nations was founded. Saddam Hussein plundered a peaceful neighbor, held innocents hostage, and gassed his own people. And all four of those crimes are punishable under the principles adopted by the Allies in 1945 and unanimously reaffirmed by the United Nations in 1950. Two weeks ago, I made mention the Nuremberg trials. Saddam Hussein must know the stakes are high, the cause is just, and today, more than ever, the determination is real. If you look into history, America never went looking for a war. But in World War II, the world paid dearly for appeasing an aggressor who could have been stopped. Appeasement leads only to further aggression and, ultimately, to war. And we are not going to make the mistake of appeasement again. One of the other mistakes--one of the other lessons, rather-- that America, like it or not, was part of the whole; that was the lesson. Hitler rejoiced at the news--if you remember your history books--rejoiced at the news from Pearl Harbor. Adolf Hitler called the attack on Pearl Harbor the turning point of the war. And he was right. But not in the way he thought. Pearl Harbor changed the world and America's role in it for all time. You here know that. During the past 3 months, men and women like you from all 50 states have helped to launch what history will judge as one of the most important deployments of allied military power since 1945. But make no mistake: the decision for this deployment was not made by the men in Baghdad. We are the ones who are standing up for civilized values, standing up for a principle that's almost as old as our republic. Franklin Roosevelt put it clearly in a fireside chat, just after Pearl Harbor. He said, "Together with other free people, we are now fighting to maintain our right to live among our world neighbors in freedom and in common decency without the fear of assault." Harry Truman understood this lesson. Almost 10 years after Pearl Harbor he, too, spoke to the nation, and he could almost have been talking about Kuwait. "Korea is a small country," he said, "thousands of miles away. But what is happening there," said Truman, "is important to every American." He called the unprovoked invasion a "direct challenge to the efforts of the free nations to build the kind of world in which men can live in freedom and peace." Since that time, allied strength and resolve have been tested many, many times. But when we look back on that history of valor and sacrifice, it is clear that the strength of our arms and the strength of our will is up to the challenge that we all face today in the Persian Gulf. We are not alone--remember this: we are not alone. The UN Security Council has passed eight major resolutions setting the terms for solving this crisis. A majority of the Arab League is with us. The Soviet Union and China are with us. And NATO's resolve has never been more firm. Today it is not Iraq against Kuwait, but it is Iraq against the rest of the civilized world. And that message, we must say it over and over again. So this unprecedented unity is a result of hard work and favorable winds--not the winds of war but the winds of change. From these magnificent Pacific islands, it's easy to see how, with skillful hands at the helm, these winds can carry us toward a future of vast horizons--a dynamic new Asia and a new partnership of nations where free peoples and free markets look to our shore for partnership and security and leadership. The world is still a dangerous place. Those in uniform will always bear the heaviest burden. Perhaps I know something of what you endure--the waiting, the uncertainty, the demands of family and professional life. We want every single American home. No American will be kept in the gulf a single day longer than necessary, but we will not walk away until our mission is done.
US Department of State Dispatch, Vol 1, No 11, November 12, 1990 Title:

Remarks to the Troops

Baker Source: Secretary Baker Description: US troops in Saudi Arabia Date: Nov 4, 199011/4/90 Category: Speeches, Testimony, Statements Region: MidEast/North Africa Country: Iraq, Kuwait Subject: Military Affairs [TEXT] Men and women of the first team, let me say that we appreciate your willingness to have us stop by to say hello today at the beginning of our trip to eight countries in 7 days. This is a long, long way from home, but I think that Americans are home wherever our principles are. And that's really what this crisis is all about. It's about the defense of the values that made the United States of America the finest and greatest country in the world. All nations have a right to be free; free from aggression-- small nations as well as large nations. It's an important principle, I think, that unprovoked aggression should not be rewarded, unprovoked aggression should not be permitted to succeed, and the world made a terrible mistake in the 1930s when we were unable or refused to stand up to unprovoked aggression. Today, we are facing the first real crisis of the post-Cold War era. We have an opportunity to participate in and establish a new international order. And we don't want to make the same mistakes that were made in the 1930s. You members of the first team are out here on the front lines, and we understand that, and we appreciate the sacrifice that's involved in being here. We appreciate as well the sacrifice that your families are making in order for you to be here. Before leaving Washington yesterday, I spoke to your commander in chief. And I bring you his best wishes and his greetings, and as you know, he will be spending Thanksgiving somewhere here perhaps with you, perhaps with others who are here just like you in the area. But I want you to know that you are constantly on the minds of the leadership of the US government as you do your part here to uphold the principles in which we believe so very, very strongly. We appreciate what you are doing, we are grateful for what you're doing, and your nation is grateful to you for what you're doing. We are extraordinarily proud of you, and I must tell you that the United States, in leading this effort, would never have been able to do so without the willingness of people like you to make the kinds of sacrifices that you are making. We are very, very proud. Thank you, God bless you, and God bless the finest and greatest nation on the face of the earth. (###)
US Department of State Dispatch, Vol 1, No 11, November 12, 1990 Title:

Key Challenges Facing South Asia

Kelly Source: John H. Kelly, Assistant Secretary for Near Eastern and South Asian Affairs Description: Statement before the Subcommittee on Asian and Pacific Affairs, House Foreign Affairs Committee, Washington, DC Date: Nov 2, 199011/2/90 Category: Speeches, Testimony, Statements Region: South Asia Country: Bangladesh, India, Pakistan, Nepal, Sri Lanka Subject: Democratization [TEXT] Thank you for this opportunity to discuss developments in South Asia at a time of change and turmoil. Before discussing each of the South Asian countries in turn, I would like to reflect on the key challenges facing us in South Asia. First and most important is the search for regional peace and stability. You are familiar with our efforts to reduce the risk of conflict over [the province of] Kashmir last spring. I am pleased to note that tensions between Pakistan and India have eased since that time. Both countries continue to maintain diplomatic and military contacts. We continue to urge both countries to adopt confidence- building measures, and we remain ready to work with them if they should find that helpful. Bitterness and violence continue to plague the Kashmir Valley, however. A cycle of violence and repression has set in, retarding the ability of Indians, Kashmiris, and Pakistanis to address the underlying issues. The human rights picture is a disturbing one. The Kashmiri militants have exacerbated this situation through tactics we find repugnant. But the Indian authorities have a special responsibility not to depart from due process of law and to maintain law and order in a humane manner. Closely related is our interest in reducing the proliferation of weapons of mass destruction. The crisis in the gulf and the high tensions last spring over Kashmir have made us and our friends in South Asia acutely aware that these weapons present a real danger, not just an abstract one. US-Soviet progress in nuclear arms control and the groundbreaking US-Soviet agreement to destroy the vast majority of chemical weapons stockpiles is another positive step toward ridding the world of potentially devastating weapons. It would be ironic if our success in reducing the arms race were accompanied by an acceleration of this wasteful competition elsewhere. We will continue to work on these issues with the countries of the region and others whose interests are strongly engaged. As you are aware, our continuing review of the issues relating to the Pressler amendment certification for Pakistan is part of this effort. In keeping with our longstanding friendship, we expect to engage the new Pakistani government early on in discussions of these issues. Meanwhile, we have complied with the law and suspended all military assistance and new economic aid to Pakistan because of the absence of certification at the beginning of the new fiscal year. Maintaining and advancing democracy in the region is a challenge for the countries of the region themselves but we have a strong interest in their efforts. Pakistan's recent elections arose in circumstances that strained the fragile democratic system in that country. In its preliminary assessment, the 40-member international observer team announced that it found the elections to have been generally open, orderly, and well administered. A new government should be formed shortly. Peaceful transfer between the roles of government and opposition is part of the democratic process, and we hope that the roots of democracy will continue to deepen in Pakistan. India's government is dealing with stubborn social and political controversies that have led to tragic loss of life and to the breakup of the government coalition. India's strong democratic traditions augur well for constitutional resolution of this crisis, but uncertain times lie ahead. Sri Lanka continues to try to maintain its democratic tradition in the face of a challenge to its national integrity by the Liberation Tigers of Tamil Eelam (LTTE). The stress has taken its toll in the form of human rights violations by both sides. Debate continues in Nepal over aspects of the new democratic constitution, which we believe will be promulgated soon. Opposition political activity appears to be picking up in Bangladesh. Bangladesh and Nepal continue to move toward more representative institutions, with our encouragement. All the countries in the region face the challenge of economic development. For most, their economic difficulties are magnified by the impact of the gulf crisis and their decisions to maintain sanctions. Development assistance is an important element in our relationship with most of the countries of the region. But they will have to rely on their own efforts to evolve sound economic policies and unleash the productive power of the private sector. Finally, and most generally, the United States faces the challenge of maintaining friendly relations throughout the region. We have sought over the years to free our ties in South Asia, and especially with India and Pakistan, from the "zero sum" mentality which suggests that strong relations with one must come at another's expense. This will continue to be our goal as we move into the post-Cold War period.
In recent months, Pakistan has been preoccupied with elections for the National Assembly. These were held as scheduled on October 24 with the IJI [Islami Jamhuri Ittihad] winning 105 seats and the PPP [Pakistan People's Party] winning 45 seats. The National Democratic Institute-sponsored 40-member international observer delegation said the elections were generally open, orderly, and well-administered. They observed some flaws in the voting, which in their judgment were not of sufficient magnitude to alter the overall results. Other observer groups, including the Canadians, provided similar assessments. Based on the information available now, the national election seems to us to have given the Pakistani people a generally fair opportunity to choose their government. It was not without flaws or controversy, but the process of dealing with irregularities and controversies is critical to a functioning democracy. We will review all available information to implement the recently enacted requirement to certify the election as condition for certain US aid. As you are aware, charges were filed against former Prime Minister [Benazir] Bhutto and members of her government. Court proceedings have begun. We hope that the process will be marked by fairness and judicial independence. History's final judgment of the process will take into account how complaints are dealt with and the process of accountability. We hope the government formation process will move forward peacefully and that the Pakistanis can put this difficult political period behind them and begin addressing the very serious challenges facing the country. We expect the National Assembly to be convened shortly, elect a speaker and deputy speaker, and then select a prime minister. The United States places great value on its longstanding relationship with Pakistan. Pakistan and the United States continue to share important interests in regional peace and stability and in an honorable political settlement in Afghanistan. We also are partners in a common enterprise in trying to reverse the effects of Iraq's aggression in the gulf. Pakistan has contributed to that effort, sending over 2,000 troops and upholding the UN sanctions. We have faced challenges in our relationship before and will do so again; our aim is to build on this solid base of shared interests.
A year ago, India held elections which peacefully replaced the long- dominant Congress (I) Party with a minority government led by Prime Minister V. P. Singh. The new government weathered a series of domestic and foreign challenges. Since early August, violent demonstrations have swept through northern and eastern India over the government's decision to pursue a broad "affirmative action" plan, reserving about half of all government jobs for the lower castes. The drastic reduction in job opportunities for other groups has led to bitter political protest, with 63 deaths and more than 150 attempted suicides. More recently, the Bharatiya Janata Party [BJP] withdrew its support from the governing National Front coalition. This decision resulted from a longstanding religious conflict centered on the BJP campaign to build a Hindu temple dedicated to the Hindu god Ram on a site which houses a 16th-century mosque. The government has insisted that temple construction await a decision by the Uttar Pradesh high court. The BJP insisted on beginning work on October 30. BJP leader L.K. Advani has led a month-long, 6,000-mile chariot procession through northern India to gain support for this endeavor. Singh attempted to reach a compromise but failed. Advani's arrest on October 23, intended to prevent potentially violent communal confrontation, led to the BJP withdrawal of support from Singh's coalition. At this point, the government has neither resigned nor been asked to resign by President Venkataraman. The president has, however, called parliament into session on November 7 to test the government's strength. The next step could be formation of a new government, if one can command a parliamentary majority, or new elections. In addition to the government crisis, unrest and violence persist in Punjab and Kashmir. We have expressed our concern about human rights abuses in both states. In Punjab, continuing violence has taken nearly 3,500 lives so far this year and has dashed hopes for new state assembly elections. In early October, parliament extended the president's rule, which has been in effect since 1987, for an additional 6 months. No date has been set for new elections. India's support for UN Security Council sanctions against Iraq is one example of an opportunity for convergence between Indian and US policies. We seek to continue in this direction as the world adjusts to the end of the Cold War. We place particular importance on the evolution of India's economic and trade policies, and we hope that economic liberalization policies will continue in spite of the present uncertain political environment.
Indo-Pakistani Relations
One of our key goals in South Asia is to reduce tensions and promote regional stability. The 40-year Indo-Pakistani rivalry has been a primary threat to peace in the area. Tensions over Kashmir have led to two wars, and since last December that troubled area has again been the focus of concerns. Within Kashmir, the Indian government has had little success in establishing a political dialogue with Kashmiris. Attacks by militants against security forces often provoke retaliatory action that harms civilians. In early October, fires destroyed hundreds of dwellings in Srinagar and surrounding areas. Jammu and Kashmir Governor Saxena has acknowledged the possibility of the security forces' responsibility for some of these blazes and promised to investigate. We expressed to the government our concern over security force excesses and the use of "collective punishment" against unarmed civilians. Last spring, the conflict in Kashmir escalated Indo-Pakistani tensions to an alarming level. American diplomacy was actively engaged on this issue. Following the May mission to both countries by Deputy National Security Adviser Robert Gates, the two sides initiated a series of talks at the foreign secretary level designed to improve government-to-government communications and explore ways of reducing tensions. The immediate risk of conflict between India and Pakistan has subsided, but tensions remain high. We hope that the two governments will continue their contacts through diplomatic and military channels and will institute other confidence-building measures to reduce the risk of conflict. We will continue to urge implementation of the 1988 India-Pakistan agreement prohibiting attacks on each other's nuclear facilities. Finally, we encourage both sides to discuss other ways to limit the risk of proliferation and the possibility of conflict on the subcontinent. We intend to work with other interested parties, such as the Soviet Union and China on this issue.
Bangladesh faces presidential and parliamentary elections in the next 21/2 years. The opposition has not yet agreed to contest the elections, but we hope that they and the government will be able to agree on a set of arrangements which will encourage full participation. Meanwhile, at least eight people have been killed in scattered violence related to an anti-government protest movement that began October 10. We hope Bangladesh will follow the lead of the new democracies in Eastern Europe, Nicaragua, and elsewhere by leaving the past and searching in good faith for a peaceful way to make its elections free, fair, and representative. In August, Bangladesh agreed to an IMF [International Monetary Fund] enhanced structural adjustment agreement designed to address its deteriorating macroeconomic situation. The country has made progress in privatization and liberalization of trade, but additional steps must be taken to make it competitive in the world market. Bangladesh has been fully supportive of international efforts in the gulf. The government has sent 2,300 troops to Saudi Arabia, adhered to sanctions, and condemned Iraq despite the presence of over 100,000 of its citizens in Iraq and Kuwait. Their remittances totaled more than 40% of the country's import capital. The gulf crisis has further aggravated Bangladesh's poverty. The administration estimates the cost of the crisis to Bangladesh for the rest of 1990 at about $350-375 million.
Nepal continues its transition to democratic government. The constitutional reforms commission presented a draft constitution to King Birendra September 10. An extensive cabinet review, which resulted in some changes, was completed on October 11. Since then, the interim government has been considering additional changes proposed by the king. Tensions in Kathmandu deepened during this third phase in the constitutional reforms process. On October 25, however, the palace announced that the constitution would be promulgated on November 9. This step will pave the way for elections, which are tentatively scheduled for spring 1991. From the drafts we have seen, the new constitution appears to represent fundamental political change. It charters a multi-party parliamentary democracy and constitutional monarchy in place of the previous "partyless" [panchayat] system, which recognized the king as the sole source of political power. The constitution also guarantees many fundamental rights. We believe it is a major step forward in the process to develop democratic institutions, which are essential to a workable, thriving democratic system. The United States has encouraged and supported Nepal's democratic transition from its beginnings last spring in Kathmandu. Through the Democratic Pluralism Initiatives program, we provided more than $800,000 in FY 1990 to support constitutional reform and the development of pluralistic democratic institutions. We will continue to offer our experience of democratic systems in whatever way the Nepalese find useful as the political transition continues.
Sri Lanka
Sri Lanka embodies one of South Asia's starkest paradoxes. On the one hand, Sri Lanka takes pride in a strong, democratic tradition and dynamic economic policies that brought a 6% annual growth rate for the first half of 1990. But Sri Lanka's continuing separatist strife has placed strains on the political system and the economy. It also has raised troubling human rights issues. Since the revival of fighting with the LTTE last June, we estimate that over 4,700 people have been killed. The military picture is still ambiguous. We are deeply concerned by alleged abuses by all parties to Sri Lanka's conflict--Tamil separatists, the JVP (a Maoist revolutionary group apparently subdued in 1989), and government security forces. The United States continues to insist, clearly and unequivocally, that human rights and humanitarian law must be respected by all. We have underscored this point on many occasions, including at the donor consultative group meeting in Paris on October 25. Other delegations, including the European Community, expressed similar concerns in their statements. Sri Lankans themselves--Sinhalese, Muslims, and Tamils--hold the key to peace and thus to a brighter future.
Our efforts to lay the groundwork for a political settlement have made some progress. We are continuing our discussions with the Soviets on a transition process, which would allow the Afghan people to determine their own future. The United States and the Soviet Union believe that there should be a transition period, culminating in self-determination, to select a government for a non-aligned Afghanistan. Our principal difference with the Soviets concerns the Najibullah regime's transition role and the powers of a transition mechanism. The fundamental decisions and responsibilities for restoring peace ultimately rest with the Afghans themselves. Within the Afghan resistance, mujahidin commanders have recently demonstrated increasing willingness to cooperate across party, ethnic, and religious lines. The most notable example of this trend was the October 9-13 meeting of several major commanders near the Pakistan- Afghanistan border. Over the past month, resistance groups have increased military pressure on the government, taking the provincial capital of Tarin Kot (Oruzgan Province) in early October through a combination of military attack and induced defections. Another provincial capital, Qalat (Zabul Province), is under siege, with a small garrison holding only the town's central fort. We welcome increased resistance unity and military effectiveness. So do the Pakistanis, as evidenced by the high-level reception given to Masood by Pakistani leaders when he visited Islamabad October 16. However, we have no favorites in the resistance, and we continue to consult closely with resistance and Pakistani leaders. (###)
US Department of State Dispatch, Vol 1, No 11, November 12, 1990 Title:

Global Professionals of the Future

Perkins Source: Edward J. Perkins, Director General of the Foreign Service and Director of Personnel Description: Address before Executive Women International, Washington, DC Date: Oct 10, 199010/10/90 Category: Speeches, Testimony, Statements Subject: State Department [TEXT] You represent one of the important but less appreciated elements in our diverse society; you are change agents of the highest order. As such, I am pleased and honored to be involved in this seminar with you this evening. A colleague of mine, asked to comment on the "downside of the peace dividend," thought the very idea provocative in the context of challenges to modern society. Similarly intrigued, I've put together a list which I am brave enough to share with you as a kind of gospel for tonight's discussion. I start by noting that greater global competition could be seen as a downside. Next, diminishing resources and financial problems tend to undermine the positive effects of reduced commitments overseas--an enormous downside. The decline or redefinition of the meaning of superpower status and the increasing multi-polarity vs. bi-polarity of the world might be a downside, at least psychologically. The fact that some leaders, such as Saddam Hussein, might see the lessening of superpower tensions and the consequent re-evaluation of defense spending as creating a vacuum, leaving the world vulnerable to their ambition, is a serious problem. But as I looked at this list, I saw something else emerging. Greater global competition means greater demand for well-trained, talented, and well-motivated people to meet that challenge, thereby focusing greater attention on our educational system. Diminishing resources means greater demand for imaginative and creative thinking permitting all of us to do more with less, thereby increasing organizational receptivity to different opinions and diversity of the workforce. Multipolarity means a greater demand for diversity--one of America's greatest strengths--something we talk about but don't utilize enough. And these latest threats to peace in the Middle East are once again a timely reminder that the world is interdependent--politically as well as economically. The decade we are entering--far from being a period of relaxation--will be a period in which our character and fiber as a nation could be tested as never before. So, in my view, the downside of the peace dividend is at once the upside. It seems to me that the approach we at the Department of State are taking to meet this challenge bears some discussion, particularly to this audience. First off, "diplomacy" means, in the sense that [diplomat-historian] Harold Nicolson defined it, the "implementation of foreign policy," meaning almost any professional activity, for all have a role to play. In this sense, the members of Executive Women International are in the forefront as revolutionaries of change--including in foreign affairs.
Our Historic, New Prospects
The developed, democratic nations of the world now stand at one of history's dividing lines between past and present. One of the great issues of our century has been the conflict between totalitarianism and democracy. The roots of this conflict go back very far--perhaps even to the 4th and 5th centuries BC--but not until our own century was the conflict between these two ideologies so clearly defined and decisively engaged. World War II rid the world of one totalitarian system--national socialism; today, it's clear that the other, communism, and its derivatives are collapsing as ideologies and working political models. What is left? Can we say that a 2,500-year-long debate about the nature of man and society has been resolved in our favor? Does it smack too much of American "particularism" to say that from 1760 to 1800, we inaugurated a revolutionary era in which the modern democratic state came into being--and to add that in the world of today, our having created history's first and only multi- ethnic, democratic state of continental proportions is more relevant to mankind's needs than ever? It looks as though our history offers a social, political, and economic message to the world of the future--and to ourselves as well, since every experience is an individual and a national learning experience. But we also must understand the major features of that future world, so that in it we can advance and protect the national interests and security of the United States. As the definition of power grows broader, those nations which best link an attractive value system to the organizational and material bases of power will become the world leaders of the future. The subject matter of future diplomacy may seem at once traditional and radically new--a combination of the 19th and 21st centuries. Our national interests will be more precisely and narrowly defined; competition for trade and resources could return to its central place in American foreign policy. India is emerging as a major power in its region. Medium- sized players exist in the Middle East, Africa, and Latin America and among the ASEAN [Association of South East Asian Nations]. The potential for vicious local conflicts, even chaos, may increase. Within the Soviet Union and along most of its borders, there runs a geopolitical faultline with dozens of points of tension, friction, and likely breakdown. India has similar problems and so do the Middle East and Africa. South Africa, Angola, and Mozambique are all struggling to sort out problems that present deadly perils to modern, productive nations. Consider a possible future where health and nutrition in Africa have declined from the levels of the great 1983-85 famine; where the sky is more ozone hole than layer; where wildlife conservation is limited mostly to zoos; where Haiti and Nepal have worn down to bedrock; and where the populations of India, Egypt, and China threaten to implode. Such a world could threaten democracy as severely as the totalitarian world we have just put behind us.
The World of the Future
It is fairly clear to me that we are moving from a world of two superpowers to one composed of a larger number of power centers. These will include the European Community, USSR, China, and Japan as well as the United States (plus Canada and perhaps Mexico) to name a few. There will be others--based largely on the economics of scarce commodities--forcing the United States and other Western nations to once again use our powers of inventiveness. A diplomacy of maneuver and shifting coalitions will emerge in place of one grand alliance in an overriding security and ideological crusade. The practice of international relations will be open, rapid, and fluid as never before: Governments will have to compete with a host of other actors; interested parties will deal with each other instantly, across borders, and often without reference to foreign ministries and embassies. The impact of technology will be pervasive. Foreign policy must, and will, encompass a wide range of critically important developmental and ecological issues, many of a scientific cast. To deal with this future, you as professionals, as well as our diplomats, will have to possess a wide range of attributes and skills--some old, some new. Inventive and revolutionary organizations such as yours will be even more important in the future in contributing to a new era in which all resources are put to use in pursuit of the greater consideration of domestic and foreign policy.
A New Prototype of the Professional
I've been asked often to describe my concept of the professional of the future. I'd like to try and look at the attributes of the future professional: Professional people, whatever their country, or whether career diplomats or others, must reflect the philosophy of that country and at the same time be internationally minded--not because it is chic, but because you have no other choice save to opt out. Able professionals of the future will reflect the full ethnic and geographic variety of the nation. They will communicate well, orally and in writing, be open to other languages--but more importantly, they will be open to international, indeed global, influences and opportunities. In this sense, our emerging China policy, for example, fits right in. As Deputy Secretary Eagleburger has said, through five administrations, representing both parties, the United States has pursued a consistent set of policy objectives with regard to China. First, we have sought to nurture a strategic relationship with China aimed at drawing the Chinese out of their isolation and encouraging their cooperation on major international issues. Second, we have sought to encourage China to use its influence in the East Asian region to reduce tensions and to promote stability. Third, we have sought to engage the Chinese in a wide variety of exchanges and other activities that will bolster political and economic reforms and the promotion of human rights. Fourth, we have sought to increase economic and commercial relations with China, so as to advance the movement toward a market-oriented economy. The impulse to building these relationships was the realization that, historically, the Chinese political process has performed unevenly; that is to say, that China has been subject to episodic convulsions, that these convulsions have sometimes directed Chinese energies inward and sometimes outward, and that there is no guarantee of consistency or evenness in our relations with the Chinese. It was precisely with these considerations in mind that those who normalized US-China relations sought to develop quickly as many interrelationships--economic, political, educational, scientific, cultural, athletic, and social--as possible. Contacts and relationships such as these could only help promote reform within China and enhance respect for human rights. Such contacts and relationships could also help to shorten the periods of tension between China and the United States that experience suggests will likely occur from time to time. And that's where you--as global professionals--come in. The Chinese--a people who historically have harbored within themselves a struggle between internationalist forces seeking contact with these outside world and nativist, xenophobic forces inclined toward isolationism--have exhibited a strong tendency to take two steps forward and then one step back. Our effort always has been to try to shorten the time required for China to work its way through its internal crises. No matter how much the current critics of our policy may try to portray it otherwise, the issue has never been whether or how fervently we support reform and respect for human rights in China. Of course we support those objectives and with as much fervor as our critics. Rather, the issue is how best to transform rhetoric into reality. Do we seek to isolate China and cause it to turn inward or do we seek to facilitate its return to reform and openness by continuing to pursue the contacts and ties that encouraged such reform in the first place? The answer to that question is one that you, as global professionals, will answer. Our emerging relationship with a dramatically changed Soviet Union is based on similar principles. The Soviets want to be where they think we are now. They have asked for our help in banking, economic, and financial analysis--even setting up a stock exchange and the other structural elements of a market economy. Information and how to use it will be the key to this historic enterprise. For you who will undertake it, computer literacy and an understanding of economics are essential tools. The new relationship between East and West in this era of glasnost and perestroika creates vast opportunities throughout the communications and information fields. There are still areas of fundamental differences with the Soviet Union in economic matters. Nonetheless, a vast number of new projects and joint ventures can go forward in the new spirit of mutual cooperation. Western firms are already actively pursuing opportunities, including proposals for large, bold, and imaginative projects by such industrial giants as AT∧T [American Telephone and Telegraph], IBM [International Business Machines], and General Motors. The climate is right for expanding such activity. Recent bilateral economic initiatives include a US-Soviet commerce and trade agreement, the ongoing US-Soviet program of technical economic cooperation, and bilateral investment and tax treaties now being negotiated. For example, the first ever "Silicon Summit" took place last June in Santa Clara, California, bringing together for the first time leading Soviet and US high-technology business leaders for the purpose of establishing trade links between US and Soviet high- technology programs. In another area, the Soviets have declared their target is to practically triple the capacity of their telephone system, including offering customers access to services such as telephone networks for data transmission and telefax, teletex, videotex, video- telephone, video conferencing, and database acquisition. Over the next 5 years, the Soviets plan to double investment in telecommunications in order, among other things, to install 5-6 million new telephone lines each year. And, of course, they're looking for investors. I leave the possibilities to your imaginations. Vision and inventiveness must be second nature to the future global professionals. They must devise creative solutions not yet thought of and apply skills of conflict resolution, development administration, economic aid, and social science. Whether in the boardroom, on the battlefield, or in the community, this spirit of creativity must be uppermost as we seek and manage change--in Eastern Europe as in the rest of the world. The global professional of the future must understand and be willing to look for our greater advantage in international trade and development--whether it be in finding openings into established but resistant markets like Japan or China or creating totally new opportunities in areas not yet thought of or properly explored, such as southern Africa. For many years after World War II, our margin of superiority on the world stage was so great that, often, our policies were helped to success simply because of our perceived weight as the world power. But the world is no longer a pushover, if it ever was one. Deputy Secretary Eagleburger noted that: "Our economic health and our ability to trade competitively on the world market may be the single most important component of our national security as we move into the next century."
Role of Women and Minorities
I can think of no better qualified group to meet the challenges to modern society than minorities and women from across this nation. As professionals, minorities and women have been doing just that for years, but the credit and the power have yet to accrue to them in proportion to their promise and potential. The United States can no longer afford this type of resource exclusion. President Bush and Secretary Baker have charged me with the task of increasing the Department's percentage of women and minorities. Executive Women International is uniquely well placed to help this effort by sharing the information that we seek to improve the diversity of our workforce and to find qualified minorities and women who desire to serve our country in the area of foreign affairs.
The Changing Work-Family Environment
American society is changing with uncommon rapidity--moving far away from practices considered typical in the 1940s through the 1960s. But even today, women (and minorities) are still under- represented at the senior levels of the Foreign Service. That picture is changing and will continue to change. Although only about 24% of our Senior Foreign Service is female, that number is double the percentage of 10 years ago. The single career woman is no longer the norm in our society. That is manifested mightily in our Foreign Service. This, too, evokes the image of the new global professional and is a positive element, assuring both fully used resources and fully satisfied individual aspirations. Half of our female FSOs [Foreign Service officers] are married. Many of those are married to fellow FSOs, but well over 200 have spouses who are not US government employees--certainly a slow move toward total "wholism" in our society, but at the moment the realities of Foreign Service life make customary American two- career family arrangements difficult. About 6% of the service is comprised of what we call tandem couples, in which both partners are full-time regular members of the Foreign Service. They may be specialists or generalists and in the State Department or in [the Department of] Agriculture, US AID [US Agency for International Development], or USIA [US Information Agency]. While this solution to the two-career family issue provides some answers, it also raises questions of assignments equity--determining whose career has priority--and the strong possibility of extended periods of leave without pay. The family member employment issue rates as one of the major concerns of the Secretary of State and is one of my top priorities. If we are to be successful as a nation in the future, we must move from the dawn of this impediment into the sunshine of innovation, ingenuity, boldness, and a prejudice-free society. We have done it before. We are a revolutionary nation and society used to solving problems. Our political democratic liberation, our industrial and labor rights upheavals, our civil rights struggles and continual fight for sexual equality all manifest our spirit as a change-oriented society. Each revolution has strengthened us as a people, as a nation, and as institutions.
To sum up, the post-World War II status quo is rapidly disappearing and with it must go any false notions of complacency. The world of foreign relations we are now entering is going to be more competitive, not less competitive, in the coming years. All professionals, whether working in business, in politics, in government or international activities must be wholistic in makeup. Such people will manifest a new renaissance of economic literacy, interest in trade policy, conflict resolution, development administration, "community capitalism," and education around the globe. Community capitalism means a community role in business generation and disposition of income and realization that neither [economists] Adam Smith nor Harold Laski will represent the model which finally emerges as the paradigm for economic-commercial activities in emerging societies, such as South Africa. We need every individual resource we can muster to meet the challenges of a more competitive international environment. In an atmosphere of diminishing resources at home and ever keener competition overseas, we can no longer afford the luxury of a fractionated foreign policy. Neither can we afford to leave the intellectual domination of foreign policy to one group of professionals; it is the growing responsibility of all citizens. We must learn to understand and make creative use of the techniques of peaceful competition as a substitute for war among nations if we are to continue to be a constructive player in this new game of post-containment diplomacy. Issues such as debt, the environment, access to natural resources and food, refugees, trade and development, and drug trafficking will increasingly drive US foreign policy concerns in this new decade. Executive Women International has a role to play in this emerging new decade because the United States must proactively rise to these challenges, and, to do so, we need all the creativity, vision, inventiveness, and flair for problem-solving that have made our country great. But more than anything else, we are going to need the kind of broad experience and adaptable outlook that is the product of diversity and of dynamic intellectual and cultural cross- fertilization if we are to meet the challenges of a multi-polar world. And here we are lucky because it is diversity that is our nation's greatest strength. That our strength comes from diversity was an idea we took for granted in the 19th century--when we needed all kinds of people to fill the great empty space that was America--but that has become a bit of a truism in the 20th. Perhaps we lost sight of its importance somewhere in the middle of "the American century" because our place in the world was obvious and maybe a little too self-assured. We are facing another great challenge to our resourcefulness as a people and as institutions representative of that people. We need to recruit people who possess the qualities required to live and work successfully in a diverse and changing environment. But I am convinced that if we make the effort to look, we will find them, because the kind of people we need are the kind of people we are. (###)
US Department of State Dispatch, Vol 1, No 11, November 12, 1990 Title:

Focus on Central and Eastern Europe: 11/12/90

Date: Nov 12, 199011/12/90 Category: Focus on Emerging Democracies Region: E/C Europe Country: Czechoslovakia (former), Hungary, Poland, Romania, Yugoslavia (former) Subject: Trade/Economics, Media/Telecommunications, Science/Technology [TEXT]
Citizens Democracy Corps
Secretary Baker Addresses Executive Committee. On October 31, Secretary of State James A. Baker, III, hosted a luncheon in the Department of State in honor of the recently named Executive Committee of the Citizens Democracy Corps (see Focus #27 or Dispatch #9 for a list of the committee members). The following excerpts are from Secretary Baker's remarks at that luncheon: ". . . It's only right, I think, that the best of our private and public sectors should join in meeting this major new challenge in Eastern Europe -- the challenge of building democratic institutions and market economies after decades of communist oppression and after decades of centrally planned devastation, as far as the economies of these countries are concerned. It's only right, too, for the citizens of one of the world's oldest democracies to help the citizens of Europe's newest democracies to recover normal lives in normal countries. As new, freely elected leaders work to transform the old systems in Central and Eastern Europe, there's an increasing need, as I know most of you know, for initiative and enterprise that the private sector of the Western world and particularly that the private sector of the United States can provide. . . . As the United States adapts its assistance programs for Eastern Europe, we believe it's important to maintain the policy of democratic differentiation that has served us and, we think, has served the citizens of Eastern Europe so very well. We will continue to target our assistance to promote democracy, to promote free markets, respect for human rights, and the rule of law. I want to close with a word about the important part that America can play in the countries that the Citizens Democracy Corps is trying to help. And I mean America, not only as a nation but really as an idea that is much alive in the minds of men and women across Central and Eastern Europe and, frankly, is very much alive in the minds of men and women in the Soviet Union today. Those of you who have been to the area within the past 12 months, I think probably know what I'm talking about. But let me give you one early, recent example. The night that they were having the parliamentary elections in Bulgaria this June, more than 100,000 citizens were gathered in the capital awaiting the election results and there was rumor or word of a dispute in the fairness of the official vote count that was passing through this rather large crowd. Some people in the crowd spotted some US election observers standing nearby. The crowd spontaneously began chanting, "USA SOS." The official count in that election was eventually set straight. But I think the point remains, and that is that America had played a key role in the support of democracy in Bulgaria, much as it had in other countries of Central and Eastern Europe during an historic election. Almost everybody, if not everybody, in that crowd knew it. There are many such opportunities, small and large, whereby the democratic freedoms of the peoples of Central and Eastern Europe and the Soviet Union can prosper. With the strong leadership of the Citizens Democracy Corps that's represented here today, we can be confident, I think, that America will not miss those new opportunities. And, of course, it is critical that the reform efforts, both political and economic, that have been undertaken by these countries in Central and Eastern Europe succeed. The world is watching. . . ."
USIA/TV Assistance
Hungary. A satellite dish provided by the US Information Agency (USIA) has been operating since late September at the Hungarian private television station, NAP TV, which began using USIA's Worldnet broadcasts in early October. Poland. Polish TV ran a 28-minute interview with former National Security Adviser Zbigniew Brzezinski in September. The interview had been arranged and recorded by USIA/TV's Foreign Broadcasters Support Unit. USIA/TV's first cooperative production with Polish TV completed a 10-day shooting schedule in Chicago, New York, and Washington, DC, on September 29. The subjects were how the US financial system works, the Polish-US Enterprise Fund, housing, local authorities, US aid programs to Poland, and the World Bank/International Monetary Fund. Romania. A satellite dish donated by USIA to Romanian TV has been operating since September. Due in part to the availability of the satellite dish, Romanian TV is now using considerable USIA/TV material, including in recent weeks the programs "Growing a Business," "The Constitution: A Delicate Balance," and "Science World." Yugoslavia. Yugoslavian TV aired almost 12 hours of USIA's Worldnet programs during September, including installments of the "First Business," "American History," "American Literature," and "Science World" series, among others.
Interns. A group of seven media interns from Central and Eastern Europe visited USIA on October 4 as part of the initial phase of a 6- month USIA media-training program. The program will include a month-long orientation to US media, emphasizing reporting and relations between the media and government; a 22-week internship at a newspaper; 2 weeks of academic study at a university; and visits to magazine and newspaper companies in New York and Washington, DC. Poland. Rutgers University professor Jerome Aumente went to Poland in October to prepare for a professionals-in-residence program that is scheduled to begin in March 1991. Professor Aumente is also advising Polish universities on curriculum development in journalism.
US To Provide Medical Supplies. Department of Defense spokesman Pete Williams announced on October 23 that the Defense Department would provide 65 tons of excess medical equipment and supplies to Czechoslovakia on October 25. It is the first donation of US medical supplies to that country. The excess supplies were collected from US medical facilities in Europe. The donation includes such things as gauze, bandages, dressings, medical and surgical instruments and equipment, and laboratory supplies. The US embassy in Prague and the Czechoslovakian government arranged for the shipment through the Defense Department's Office of Humanitarian Assistance. During the past 5 years, in addition to Czechoslovakia, that office has arranged for donations to Bulgaria, Hungary, Poland, and Romania. A total of 40 countries, including 13 in Africa, have received excess property from the Department of Defense.
Prime Minister Jozsef Antall made an official visit to Washington, DC, October 17-19. On October 18, White House press secretary Marlin Fitzwater released the following fact sheet on US assistance to Hungary:
Food Aid
-- To help meet Hungary's grain needs during the current drought, the US government offered $47.5 million in new credits and loan guarantees for Hungary; $40 million of the total consist of official US guarantees for 7-year commercial credits for US commodities, and $7.5 million are long-term credits on highly concessional items. These credits, taken together, should meet more than half of Hungary's estimated grain shortfall of 800,000 tons. -- The US government will also be working closely with the Group of 24 industrialized countries (G-24) to meet Hungary's food- assistance needs.
Energy Assistance
-- The US government is asking the International Monetary Fund to increase its lending to Central and East European countries by as much as $5 billion, modifying its lending policies as appropriate. The United States will also ask the World Bank to accelerate its assistance in the energy field, drawing on the $9 billion now committed to, or planned for, Central and Eastern Europe. -- The US government provides direct bilateral aid for "quick fix" energy-efficiency projects and cooperation with the International Bank for Reconstruction and Development, the International Energy Agency, and the European Community in a regional energy-efficiency project. These projects are designed to help Hungary overcome short- and medium-term energy crises. -- The US government also provides longer-term assistance for energy conservation, energy efficiency, clean-coal technology, and nuclear safety -- all crucial to Hungary if it is to overcome the effects of the energy crisis caused by reduced Soviet shipments, high world-market prices, and the unavailability of promised supplies from Iraq.
Major Continuing US Initiatives
-- Enterprise Fund. The Hungarian-US Enterprise Fund, launched on March 30, is fully operational and had $5 million available in FY 1990 for loans and grants to stimulate private business formation. From FY 1991 funding, $21 million is available for
-- Environment. The US-sponsored Regional Environmental Center in Budapest was inaugurated on September 6. The original $1.6 million of US funding attracted about $13 million in contributions from other G-24 members, which has made it possible to increase the number of activities of the center. Several environmental programs already are under way.
Technical and Educational Assistance:
-- The United States sponsors business and management training to prepare a new generation of Hungarians to run a market economy. -- US programs are under way to help telecommunications systems, which are needed for international business. -- A full-time US adviser and computer equipment worth $250,000 have been provided to the State Property Agency to help in privatizing the Hungarian economy. -- The United States is funding technical advice in financial services and banking by the Securities and Exchange Commission and the Financial Services Volunteer Corps. -- 58 Peace Corps volunteers are training English teachers and supporting small-business development. -- The US Agency for International Development is giving technical assistance for privatizing public housing. -- The United States also provides technical assistance to design and fund major infrastructure projects.
Democracy Initiatives
-- Several groups of new Hungarian parliamentarians have come to the United States for training, and technical advice is being provided to establish a parliamentary research service and legislative staff services. -- The United States has provided computers and other high- technology equipment to the Hungarian Parliament. This equipment will give all parliamentarians equal access to a large data base and will assist them in drafting new legislation. -- The United States is helping with rule-of-law programs designed to assist in the drafting of new criminal and civil codes and administrative procedures. -- The United States provides information about an independent judiciary and a more civil-rights-oriented police authority. -- More than $1 million have been provided for other democratic initiatives, including election training, support for opposition parties, and building democratic institutions. (###)
US Department of State Dispatch, Vol 1, No 11, November 12, 1990 Title:

Current Treaty Actions, October 1990

Date: Oct 30, 199010/30/90 Category: Treaties/Agreements Country: Canada, Egypt, South Korea, Ireland, Italy, Namibia, Netherlands, Nicaragua, Philippines, Poland, Senegal, USSR (former), Venezuela Subject: International Law, Resource Management, Environment, Trade/Economics [TEXT]
International plant protection convention. Done at Rome Dec. 6, 1951. Entered into force Apr. 3, 1952; for the US Aug. 18, 1972. TIAS 7465. Adherence deposited: St. Kitts ∧ Nevis, Apr. 17, 1990.
Maritime Matters
Convention on facilitation of international maritime traffic, with annex. Done at London Apr. 9, 1965. Entered into force Mar. 5, 1967; for the US May 16, 1967. TIAS 6251. Accession deposited: Portugal, Aug. 6, 1990.
Nuclear Weapons--Non-Proliferation
Treaty on the non-proliferation of nuclear weapons. Done at Washington, London, and Moscow July 1, 1968. Entered into force Mar. 5, 1970. TIAS 6839. Accession deposited: Albania, Sept. 12, 1990.
Annex V to the international convention for the prevention of pollution from ships, 1973. Done at London Nov. 2, 1973. Entered into force Dec. 31, 1988. Acceptance deposited: Australia, Aug. 14, 1990. Convention for the protection of the ozone layer, with annexes. Done at Vienna Mar. 22, 1985. Entered into force Sept. 22, 1988. (Senate) Treaty Doc. 99-9. Montreal protocol on substances that deplete the ozone layer, with annex. Done at Montreal Sept. 16, 1987. Entered into force Jan. 1, 1989. (Senate) Treaty Doc. 100-10. Accessions deposited: Brazil, Mar. 19, 1990; Iran, Oct. 3, 1990. Protocol to the 1979 convention on long-range trans-boundary air pollution concerning the control of emissions of nitrogen oxides or their transboundary flows, with annex. Done at Sofia Oct. 31, 1988. (1) Ratifications deposited: Luxembourg, Oct. 4, 1990; UK, Oct. 15, 1990.
Convention against torture and other cruel, inhuman, or degrading treatment or punishment. Done at New York Dec. 10, 1984. Entered into force June 26, 1987. (2) (Senate) Treaty Doc. 100-20. Senate advice and consent to ratification: Oct. 27, 1990. (3)
Agreement on fisheries enforcement. Signed at Ottawa Sept. 26, 1990. Enters into force upon notification by the parties that they have completed their internal procedures.
Grant agreement for commodity imports. Signed at Cairo Sept. 30, 1990. Entered into force Sept. 30, 1990.
Agreement extending the agreement of Dec. 11, 1978 (TIAS 9609), for scientific and technical cooperation. Signed at Jakarta Oct. 4 and 5, 1990. Entered into force Oct. 5, 1990.
Agreement amending the agreement of Feb. 3, 1945 (EAS 460), as amended, relating to air transport services, with annex. Effected by exchange of notes at Dublin July 25 and Sept. 6, 1990. Supersedes agreement of June 11, 1973 (TIAS 7660).
Memorandum of understanding relating to the air transport services agreement of June 22, 1970 (TIAS 6957), as amended, with related exchange of letters. Signed at Rome Sept. 27, 1990. Entered into force Sept. 27, 1990, except for amendment to Article 10, which shall enter into force on the 15th day following the date of exchange of notes covering the Italian instrument of ratification.
General agreement for special development assistance. Signed at New York Sept. 28, 1990. Entered into force Sept. 28, 1990.
Agreement on social security, with administrative arrangement. Signed at The Hague Dec. 8, 1987. Protocol to the agreement on social security and administrative arrangement of Dec. 8, 1987. Signed at The Hague Dec. 7, 1989. Entered into force: Nov. 1, 1990.
Grant agreement to provide balance-of-payments support and to assist Nicaragua in its efforts to stabilize the economy. Signed at Washington Sept. 26, 1990. Entered into force Sept. 26, 1990.
Grant agreement for natural resources management program. Signed at Manila Sept. 28, 1990. Entered into force Sept. 28, 1990.
Agreement regarding the consolidation and rescheduling of certain debts owed to, guaranteed by, or insured by the US government and its agencies, with annexes. Signed at Warsaw Aug. 24, 1990. Entered into force: Oct. 22, 1990.
Treaty concerning the reciprocal encouragement and protection of investment, with annex and protocol. Signed at Washington Dec. 6, 1983. (Senate) Treaty Doc. 99-15. Entered into force: Oct. 25, 1990.
Agreement regarding certain maritime matters, with annexes. Signed at Washington June 1, 1990. Entered into force: Oct. 1, 1990.
Agreement amending the annex to the air transport services agreement of Aug. 14, 1953, as amended (TIAS 2813, 7549, 8433). Effected by exchange of notes at Washington July 19 and Oct. 10, 1990. Entered into force Oct. 10, 1990. 1 Not in force. 2 Not in force for the US. 3 With reservations, declarations, understandings, and a proviso. (###)